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Philistines

IDIQs, Excusable Delays, and the Changes Clause

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My Agency frequently awards IDIQs. Unfortunately, we have lost a lot of design time for new Task Orders due to pandemic. Unfortunately, many IDIQs ordering periods are set to end. We are having a vigorous discussion as to whether Excusable Delays or the Changes Clauses would be appropriate to extend the ordering period. The basic arguments against using them are that IDIQs are contracts to potentially order work as opposed to an actual order for work. While that argument may make sense for a rejection of the Excusable Delays clause, it would still seem appropriate to allow for the changes clause to alter the delivery schedule of all contracts under a multiple award IDIQ. In effect, we are changing the delivery time frame for the potential work to be ordered. My questions are a) If others have had this conversation in their agencies, what was the consensus/practices adopted? and 2) Has anyone seen either of these clauses used in this type of situation?

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Folks may ask so I will pop the question first.   Commercial item contracts or not?  Does not make a big difference but the excusable delay and changes clauses vary between commercial and non-commercial.

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Definitely non-commercial. They are for specialized technical services almost exclusively. Typically, they are CPFF but there are some instances of FFP and T&M. Supplies can on occasion enter into the equation in combination with the services but we do not use our IDIQs for supplies.

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Philistines,

I don't think Excusable Delays will work for ordering period extensions.  However, it could work for task order delivery (or performance) extensions, but you need to read the Excusable Delays text in your contract and satisfy yourself that it fits your circumstance.

I don't think the Changes clause will work for either one.

My thought:  Use Excusable Delays for task order time extensions (only time, no money) (but only after you read the text in your contract and satisfy yourself that it fits).  For ordering period extensions for the parent IDIQ contracts, write a J&A and proceed.

Edited by ji20874
changed JEFO to J&A

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JI20874 - That is what we are doing. Using the Delays clause to extend TOs and J&As (our JEFOs) to extend IDIQs. However, the non-comp process is purposefully burdensome and we are looking for ideas on extending ordering periods.

I haven't found a GAO case dealing with the issue so it could be territory that legal counsel has fenced off.

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1 hour ago, Philistines said:

JI20874 - That is what we are doing. Using the Delays clause to extend TOs and J&As (our JEFOs) to extend IDIQs. However, the non-comp process is purposefully burdensome and we are looking for ideas on extending ordering periods.

I haven't found a GAO case dealing with the issue so it could be territory that legal counsel has fenced off.

Has your legal counsel nixed the idea and you are looking for support for your idea to convince legal?

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I don't think you will find a way around JEFOs (J&As) for real bona fide changes in scope -- and extensions of ordering periods are changes in scope, unless they can be made to fit under a contract clause that allows for adjustments or equitable adjustments.  For the parent IDIQ contracts, finding a clause that will cover your ordering period extension will take some creativity.

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2 hours ago, ji20874 said:

For ordering period extensions for the parent IDIQ contracts, write a JEFO and proceed -- cite FAR 16.505(b)(2)(i)(A).

Wouldn't FAR part 6 apply to such a modification?

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25 minutes ago, Don Mansfield said:

Wouldn't FAR part 6 apply to such a modification?

Yes.

Edited by ji20874
changed no to yes

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1 minute ago, ji20874 said:

No.

How so? What exception at FAR 6.001 applies? You said that "extensions of ordering periods are changes in scope." FAR 6.001 only states an exception for modifications that are within the scope of the contract.

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You're right -- we're talking about the parent IDIQ contract (not an order) so a J&A is probably right.

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@joel hoffman That is correct. Legal counsel and most of the the CO community wants us to write a J&A. We will but I wanted to see if anybody else had any experiences or thoughts on using either clause.

The GAO has been fairly generous towards agencies in determining when competition is triggered by the Changes clause. My thought was 'How would the competition have been impacted if this change (longer ordering period) was known at the time of the solicitation? The only impact that I see is that maybe somebody would have bid on a six year IDIQ that did not bid on a 5 year one but I consider that a stretch given the competition that we have. Only companies who did not bid would have standing to protest on that basis. None of the losing bidders could argue that they were disadvantaged by the longer extension. IMO.

I'm just fishing for thoughts or experiences.

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ji20874 - We do use those from time to time. The posting requirements still mandate multiple postings. But yes, the J&As will look incredibly similar. From a process (approval/clearance perspective), it's the same amount of work.

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@Philistines,

Is the ordering period stated with calendar dates in the contract? Or does it state that the ordering period is "12 months"? If the latter, was there a time period where the Govt. couldn't issue orders or the contractor couldn't accept them because of the pandemic?

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We have variations but typically, it states five years from the date of signature. Though some COs will put in a specific date. I do like your thinking though...

Some would say that we were open for business but if other business (pandemic response) overwhelmed us, then we could not order during that time frame. 

Is that where you were going?

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Yes. The way I see it, you can measure a period of time with a calendar or a stop watch. If you measure the period with a stop watch, it could read less than 12 months even though 12 months have passed on the calendar. Perhaps you had to stop the watch during the pandemic?

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Backtracking...

Excusable delay - A remedy for a CONTRACTORS failed performance, correct?

Changes (other than commercial item) - extending performance is not one of the unilateral rights granted.

Extending performance with out the blah blah blah of a J&A.  Depends on scope of contract does it not?  By example - if contract states it is for the purpose of providing technical assistance to accomplish 25 NEPAS and due to effects of COVID the government can only get stuff to contractor for 20 is it a change in scope to add more time to the IDIQ so the 5 can be accomplished?  Maybe not.

The basic standard of GAO sticks my brain on a very interesting question posed by the OP.  That standard is - if there is a material difference between the modified contract and the original contract. I would personally look to the stated scope of the contract and not just that it states a 5 year period of performance as a possible "in" to extend with a basic determination to support the mod versus a J&A.

Thoughts?

 

 

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My thought on the Changes clause is the Time of Performance. A small hook to hang my hat but I just need it to hold up for a little bit.

The actual scope meaning the work to be done doesn't change. We just need more time.

RE: Delays - We're a polite bunch. We prefer to say that the contractor could not perform rather than failed. But yes, the clause is justified when an event impacts the contractor, not the government. USG caused delays opens up the issue of equitable adjustments, which does not apply here.

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Philistines,

If I were doing an adjustment under the Excusable Delays clause, I would use the wording of the Excusable Delays clause.  But that's me.

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ji20874 - Not sure the point that you are making. Perhaps you're restating that the Delays clause is not a viable choice in regards to an IDIQ ordering period. Or perhaps you are referring to the term adjustment. It is our legal team's opinion that you cannot make any adjustment but time under the 52.249-14 that we can only add time to the contract.

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No, my point was that whenever I use any contract clause as the basis for an action, I always try to use the same words that the clause uses.  You said you don't like to use the word "failed" and prefer to use a more polite wording instead, but isn't a contractor failure a necessary prerequisite to using the Excusable Delays clause?

I don't know your contracts well enough to know if one of the contract clauses will allow you to extend the ordering period of the parent IDIQ contracts. IDIQ contracts seem rarely to be set up like Carl suggested, and for those, he is right -- an extension of the ordering period need not be a change in scope.  If Government operations were shut down during the pandemic, you might be able to justify an extension of the ordering period as Don suggested.  But for many (most?) IDIQ contracts, you might have to use a J&A.

But if your organization doesn't want to do J&As, then don't.  Let the parent contracts die as scheduled.  Here is a novel thought:  If the contracts are important to your agency's mission, then your attorneys and everyone else should eagerly help you get the J&As done -- you shouldn't have to fight them.  Just tell your agency executives now that you want to extend the ordering periods but your attorneys refuse to let you, and that the contracts will die soon.

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ji20874 - It's not the J&As are problematic in theory. We deliberately created a cumbersome process to make people not use them. Once you release the Bureaucratic Kraken though, you find it very hard to bind it again.

I am simply trying to lighten the load of an overworked 1102 workforce faithfully fighting the good fight to get the work done. Whenever I see a process that does not add value or impact outcomes, I always try to remove it.

Thank y'all for the good input. 

Others feel free to opine if the feeling strikes.

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22 hours ago, Philistines said:

the clause is justified when an event impacts the contractor, not the government. USG caused delays opens up the issue of equitable adjustments, which does not apply here.

Philistines, note that the Excusable Delay clause states in part that delays caused by "acts of the Government in either its sovereign or contractual capacity, epidemics and quarantine restrictions," are the types of delays that are excusable.  Are you reading government caused delays our of the clause?

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@Philistines,

I think that you're under the impression that you need a contract clause to support an extension of the ordering period due to the pandemic. If that's what you think, then I disagree. Contract clauses like Excusable Delays and Changes deal with a party's right to an adjustment under prescribed conditions. The presence or absence of such clauses in a contract does not limit the parties' rights to negotiate adjustments to contract terms to adapt to conditions that they did not contemplate during contract formation. Further, such adjustments are not necessarily outside the scope of the competition.

For example, let's say the Government competitively awards a contract to Acme Corp. to deliver 100 widgets by 31 July at a price of $100K/widget. On 17 July Acme Corp. calls the contracting officer and asks if the delivery date can be moved to 31 August because they are experiencing an unusually high volume of orders. The contracting officer checks with the customer, who is ok with the later delivery. The contracting officer then agrees to adjust the delivery date if the contractor agrees to a price reduction of 5% as consideration. Contractor agrees and the contract delivery date and price are modified accordingly. The contracting officer doesn't write a J&A.

The change agreed to by the parties has nothing to do with the Excusable Delays clause, Changes clause, or any other standard FAR clause. The modification is not necessarily outside the scope of the competition. Do you think any law or regulation has been violated?

Let's say I were administering an IDIQ contract that had a 12 month ordering period and, during that period, the contractor was unable to accept orders due to circumstances beyond its control for a period of two months. I would argue that the clock on the 12 month period stopped during those two months. If someone were to argue that the 12 month period necessarily ended at the end of 12 calendar months, I would ask why a calendar (rather than a stop watch) was necessarily the correct way to measure the time period. I think you would still have two more months of ordering period at the end of 12 calendar months. If the contract had a stated end date to the ordering period, I don't think a modification to change the date would necessarily be outside the scope of the competition.

Note that this has nothing to do with the Excusable Delays clause, the Changes clause, or any other standard FAR clause. It's just the parties adapting to unforeseen conditions. That's what contract administration is all about.

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