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A firm fixed price proposal was negotiated at a value of $800K. Funding at the time was available in the amount of $500K.  The contract was awarded at a value of $800K, pursuant to DFARS 252.232-7007, the intention was to incrementally fund the contract in the amount of $500K. At the time, the organization was experiencing issues with the contract writing system, which resulted in the CLINs being inadvertently fully funded, thus over-obligating the $500K funding document by $300K.  Unknowingly, the KO signed the contract.  Within the same day, the error was discovered   A modification was done to reduce the obligation to the $500K available. 

Does this constitute an ADA violation?   

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The limit of the government’s obligation per the contract clause was $500k. 

I don’t think that the contractor would have overspent that amount in a few hours. 

Looks like an inadvertent, administrative error that could be corrected by an Admin mod. At the worst, due to the direct conflict in the contract, it should be a patent ambiguity in the contract document. 

Is there a reason not to contact your legal office to ask ? (Maybe concern that someone will get into trouble...?). 

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It was a simple error, and it was caught and remedied on the same day?  No, this was not an ADA violation.  I suspect the agency had $300K somewhere.  It was a simple error, and it was caught and remedied on the same day.

Try2B, Are you the one making the charge that it is an ADA violation, or are you resisting the charge?

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Thanks for your responses. I was of the mindset that it was an administrative error easily fixed by a modification, however the supervisor insisted it was an ADA violation. So much so that there was disciplinary actions taken on the KO and the CS.

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I sure hope that the supervisor never makes a mistake. Like I said, at the worst it appeared to be a patent ambiguity in the actual contract. Who discovered the error? 

Unless there is a software problem that matched the contract amount to the funding, yes someone did screw up. One should always verify the funded amounts, right? With the electronic contracting system, i don’t know but it would seem that the obligation document should cross-link with the obligations in the contract document output. 

There is supposed to be pre-award legal review for certain dollar thresholds in DoD contracting but I’m not up to date on the mechanics of that. It was always a checklist item in our reviews. 

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9 minutes ago, Try2B said:

@joel hoffman The CS discovered the error.

Good catch. Pls see my edit above. Would a pre-award legal review have caught it? 

 

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Gosh, is the DoD standard procurement system that clunky that one can’t enter global data that cross-check and cross-link to the proper fields? Seems like the funding document should put limits on what you can show as obligations for the CLINs and total contract obligation...The funding document should be interactive in the system and serve as a limit to what can be obligated. 

Who the Heck would design an electronic contracting system without such a cross-check?  

The legacy  USACE financial management system (CEFMS) used to have checks and balances and I think is now interactive with the DoD system as well as the USACE legacy Resident Management System.  Having to do multiple data entries is a waste of resources and invites errors...

i freely admit not being up to date but electronic contracting systems are supposed to improve efficiency, reduce errors and should have checks and balances designed in, not to mention the still required pre-award reviews. 

Maybe someone didn’t do a pre-award check. Half a million or $800k is still a lot of money,  to me at least.

Year end rush..?

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On 10/2/2019 at 12:19 AM, Try2B said:

Does this constitute an ADA violation?   

It depends on what you mean when you wrote that funding available was only $500,000.  Was the $500,000 limit a formal or informal limitation?

An appropriation allows an agency to incur obligations and make payments out of the Treasury for specified purposes. 

Below an appropriation is the “apportionment,” which is a distribution by the OMB of amounts available in an appropriation.

Administrative subdivisions imposed by an agency are the third level of fiscal control and are divided into “formal” and “informal” administrative subdivisions.  Formal administrative subdivisions consist of allocations and allotments.  Informal administrative subdivisions are created by agencies at lower levels and are considered funding targets, or “allowances.”

Exceeding an allowance or other informal subdivision of funds does not violate the ADA unless to do so would also cause a formal subdivision, an apportionment, or an appropriation to be exceeded.  So, if sufficient funds were available at the formal administrative subdivision level, the KO's over-obligation of the allowance, while improper, would not amount to a violation of the ADA.

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One last thought. With paper files, one could view the final document and flip through various tabs to cross-check the funding document and all the supporting backup. 

The ACO or KO would sign the actual paper form(s). 

I hate it if one only has access to one screen at a time and can view input boxes but not all the subsequent output before electronically signing an obligation. That might not be the way it is now but...people seem to put too much faith into machines and software programs. 

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9 minutes ago, Try2B said:

@Lionel Hutz The finance office had the full $800k available in the same FY, however the funding document they created for this contract was only for $500K. That's what was budgeted for at the time.

Then there was no ADA violation.

But the supervisor says there was, and imposes discipline accordingly.  Okay, did the supervisor report the ADA violation up channels and to the Congress as required by law?

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@Try2B You aren’t following what Lionel Hutz is saying.  Your response that $500K is all that’s budgeted isn’t relevant.   He and ji20874 are correct.  If you don’t understand what Lionel Hutz is explaining, go ask your finance or Comptroller people to explain.  

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1 hour ago, ji20874 said:

Then there was no ADA violation.

But the supervisor says there was, and imposes discipline accordingly.  Okay, did the supervisor report the ADA violation up channels and to the Congress as required by law?

 

25 minutes ago, formerfed said:

@Try2B You aren’t following what Lionel Hutz is saying.  Your response that $500K is all that’s budgeted isn’t relevant.   He and ji20874 are correct.  If you don’t understand what Lionel Hutz is explaining, go ask your finance or Comptroller people to explain.  

Correct In all respects. I concur with these two guys.In all respects. I concur with these two guys.

I too, am curious about whether the supervisor reported this as an ADA violation up the chain.

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On ‎10‎/‎1‎/‎2019 at 3:19 PM, Try2B said:

At the time, the organization was experiencing issues with the contract writing system, which resulted in the CLINs being inadvertently fully funded, thus over-obligating the $500K funding document by $300K.

No, the Government created an obligation of $500K regardless of what the computer spit out. If the agency's books reflected an obligation of $800K, then that would violate the Recording statute--not the Anti-Deficiency Act.

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4 minutes ago, joel hoffman said:

I too, am curious about whether the supervisor reported this as an ADA violation up the chain.

Maybe someone should report the supervisor for not reporting the "ADA violation".

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I worked with a CO who inadvertently signed a contract for a major system on September 28, two days before the contract effective date with next years funding.  This involved specific line item funding.  The mistake occurred from the year end rush and the CO didn’t think.  The obligation got properly recorded with next years funding too.  

The IG caught this because of the program visibility right away and said it needed reported to Congress and the President as an ADA violation and personally citing the CO.  Fortunately a Congressional staffer got an OMB staffer on the phone with the IG and strongly suggested the IG drop the matter.  

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