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On 2/13/2022 at 11:02 PM, Don Mansfield said:

The dust has not settled on this issue. The FAR Councils' rationale for concluding that set-asides are discretionary overseas is not supported by the facts. See the ABA's comments submitted in response to the proposed rule for FAR Case 2016-002: https://www.regulations.gov/comment/FAR-2016-0002-0025

If I were you, I would go along with the agency's position unless the final rule comes out making set-asides mandatory regardless of place of performance.

Don, thank you.  ABA comments are helpful.  I hope final rule clarifies, but probably not.   Thank you for providing this link.   I have requested my office to look up your 2015 article that Vern mentioned.  Look forward to reading that.  Thank you again.  

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34 minutes ago, Tzarina of Compliance said:

Don, thank you.  ABA comments are helpful.  I hope final rule clarifies, but probably not.   Thank you for providing this link.   I have requested my office to look up your 2015 article that Vern mentioned.  Look forward to reading that.  Thank you again.  

Tzarina, you mentioned the Foreign Assistance Act earlier. Are you specifically asking about non-military agency programs (e.g., USAID, Dept of Commerce, etc.)? I don’t know what country to country agreements apply to such foreign programs. Are you aware of any that would be applicable to your contracts (e.g., USAID)? I’d think that there would be…

Thanks! 

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I would think US Agencies providing military OR non-military services to foreign countries would have some type of country to country or program agreements. If not or if the recipient country doesn’t care who you contract with, then your question is still open.

Edit- add: But if they do care, the Part 19 programs are restricted to or favor US Small Businesses, correct? I’m sure that would go over like a lead balloon…

 

Edited by joel hoffman
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27 minutes ago, joel hoffman said:

Tzarina, you mentioned the Foreign Assistance Act earlier. Are you specifically asking about non-military agency programs (e.g., USAID, Dept of Commerce, etc.)? I don’t know what country to country agreements apply to such foreign programs. Are you aware of any that would be applicable to your contracts (e.g., USAID)? I’d think that there would be…

Thanks! 

Thats a good point.  Having read through all the info provided here, I am thinking that the way the agency obligates funding to specific country accounts before the funding is used to what is called "sub-obligation" to contracts may support the whole "overseas contracting" argument, even though the actual "performance" is  in the US if you count it by dollar value or by number of personnel and where they work from.  Very confusing.  If the whole thing is exempt, then say its exempt and all the set-asides and SB sub plans are completely discretionary.  If it is not exempt, then everyone follows the same rules.... 

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As for your services assistance to the Greek government example,  the Greeks might not care how you contract for the assistance. However, if it were for construction, I’ll bet they would care. 

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3 hours ago, ji20874 said:

Tzarina,

So, what have you decided for your situation?  Contract performance is or is not entirely outside the U.S.?

I am leaning towards it is NOT, although my choice would just be considered "discretionary".  Until it is clear what is considered "performance in the US" and how that is determined, people will continue to wing it.  At least in this industry, which is non-DOD.  

2 hours ago, Don Mansfield said:

@Tzarina of Compliance,

Note that the authority at FAR 6.302-4(a)(2) would likely trump set-aside rules. 

I this case, the Foreign Assistance bilaterals do not restrict sources, so it just defaults to the rest of the FAR.

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12 hours ago, Tzarina of Compliance said:

Until it is clear what is considered "performance in the US" and how that is determined, people will continue to wing it.

FAR 19.000(b) indicates that small business programs apply only in the United States... There is no language therein about "performance."

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19 hours ago, Tzarina of Compliance said:

Until it is clear what is considered "performance in the US" and how that is determined, people will continue to wing it.

Is there a problem?  Is it bad for "people to continue to wing it"?

I don't see a problem.  I am okay with two different contracting officers having different but both reasonable opinions.

I think we are not served well by insisting on more and more rules and less and less professional discretion.

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16 minutes ago, ji20874 said:

Is there a problem?  Is it bad for "people to continue to wing it"?

I don't see a problem.  I am okay with two different contracting officers having different but both reasonable opinions.

I think we are not served well by insisting on more and more rules and less and less professional discretion.

Highlighted much of the time in Forum is the reflected experience that professional discretion may not be that but just a "wing it" as implied by Tzarina which by my read  means someone does do something without much preparation and practice.  I do wonder how many CO's, by example, have taken the time to personally explore the matter discussed here in to arrive at a reasonable opinion, or should I say a well documented decision as to why or why not for an instant procurement?   

I agree with less rules and professional discretion while I also agree there should be a genuine concern with regard to people "winging it".  Winging it probably happens much more than it should!  For an industry that experiences it a lot, where I suspect such inconsistency might be the lynch pin to proposal pricing and even acceptance it would seem an added rule of definition might be a very good thing for everyone.

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1 hour ago, ji20874 said:

I think we are not served well by insisting on more and more rules and less and less professional discretion.

While I generally agree with that view, I have some questions, starting with: What does "professional discretion" mean?

What makes discretion "professional"?

  • Is it the standing of  the person exercising it?
  • Is it the subject matter, regardless of who is exercising it?
  • Is it the way in which discretion is exercised, regardless of the subject?

If it is discretion exercised by a professional, then what is a professional? Uber calls its drivers "professionals":

Quote

Professional drivers on every trip

Expect elevated service from professional drivers. People driving with Uber Black must maintain a minimum rating requirement of 4.85 stars, be insured to drive commercially, and meet state-or local-level livery regulations.

https://www.uber.com/us/en/ride/uberblack/

Is a profession anything someone does for a living?

Is a professional someone who does something for a living, so that Uber drivers are professionals in the same way that physicians are professionals?

Is a professional someone who is polite and decorous in the office, even though they are ignorant of and unskilled at their work?

Is a truly and deeply knowledgeable and skilled person doing complex work extremely well unprofessional because they are impatient and do not suffer fools gladly or sympathetically?

I'm not opposed to professional discretion. But are contracting officers really professionals? If so, what makes them so? Is it the fact of having been appointed. Is it the kind of work they do? Is it how well they do that work?

FAR 19.000(b) is a declarative sentence that makes a statement about the implementation of policy. As a statement, it's true or false. In order for us to know whether it's true or false we have to know what it means. I don't know what it means. I think it is vague, because it is not clear about "applies only in" means.

Should the implementation of a national policy depend on the discretion of individuals interpreting a vague instruction? Or should the policy be clear?

When I read ji20874's post I found myself uncertain about its implications. On the one hand, I wanted to agree, but on the other hand, I found myself unable to do so without hesitation. I'm just stating the reasons for my uncertainty.

If I were facing a problem about that required interpretation of 19.000(b) I would not ask strangers for guidance. I would do some background research, talk to respected colleagues, decide what I want to do, and then construct an argument that supports my plan and try to sell it to the powers that be. Absent clear direction, I wouldn't agonize over the decision. If it's wrong, someone will sort me out. Or maybe not.

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Added thought:

According to Andrew Abbott in The System of Professionals: An Essay on the Division of Expert Labor (Univ. of Chicago, 1988):

  • On page 8: "[P]rofessions are exclusive occupational groups applying somewhat abstract knowledge to particular cases."
  • On page 35: "The tasks of professions are human problems amenable to expert service."

The keys, in Abbott's view, are knowledge and expertise (skill in application).

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Even though Google Maps might dictate the "best" route for an Uber driver, I am okay with allowing the driver some professional discretion in deciding the course for a particular trip.

32 minutes ago, Vern Edwards said:

If I were facing a problem about that required interpretation of 19.000(b) I would not ask strangers for guidance. I would do some background research, talk to respected colleagues, decide what I want to do, and then construct an argument that supports my plan and try to sell it to the powers that be. Absent clear direction, I wouldn't agonize over the decision. If it's wrong, someone will sort me out. Or maybe not.

I agree.  I would not want to insist on more rules to make the decision for me.  I am okay with two different contracting officers having different but both reasonable opinions.

35 minutes ago, Vern Edwards said:

But are contracting officers really professionals?

Good question -- are contracting officers professionals or clerks?  I want them to be professionals, and to act like professionals, and to make decisions like professionals.  I know others want to take away discretion from contracting officers.

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15 minutes ago, ji20874 said:

I know others want to take away discretion from contracting officers.

Who? Why? I've been a senior staffer in a four-star military command. In my experience senior people want to take discretion away from COs because they don't like the way the COs have used the discretion. Also, in my experience, most COs have not been truly expert in the matters they handle.

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10 hours ago, Neil Roberts said:

FAR 19.000(b) indicates that small business programs apply only in the United States... There is no language therein about "performance."

True, but see the prescription for the provision at FAR 52.219-1, Small Business Program Representation:

Quote

Insert the provision at 52.219-1, Small Business Program Representations, in solicitations exceeding the micro-purchase threshold when the contract will be performed in the United States or its outlying areas.

 

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On 2/7/2022 at 8:52 AM, Tzarina of Compliance said:

but the services are purchased from personnel hired in the United States and posted overseas, plus the indirect cost pools are for personnel who are located in the United States.  So, if I have a contract which is to be performed under Foreign Assistance Act in, lets say, Egypt, and I am hiring contractors in the US, who then go and hire personnel in the US and send them to Egypt and also maintain a home office in the US which is paid for by indirect costs.  Let's say all the costs that are actually "incurred" overseas for the performance are about 30% of the contract and the rest are "incurred" in the US.  Is the contract performed overseas?

1. How would you know, prior to receiving proposals, where the personnel would be hired and that the indirect cost pools are for personnel who are located in the United States?

2. How would you know, prior to receiving proposals, that you were going to hire contractors in the US who would then go and hire personnel in the US and send them to Egypt and also maintain a home office in the US which is paid for by indirect costs?

I ask because the decision whether or not to set aside is made before soliciting proposals.

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26 minutes ago, Vern Edwards said:

Who? Why? I've been a senior staffer in a four-star military command. In my experience senior people want to take discretion away from COs because they don't like the way the COs have used the discretion. Also, in my experience, most COs have not been truly expert in the matters they handle.

Most of the rhetoric after the acquisition reform efforts of the 90's focused on taking discretion away from contracting officers and ensuring "consistency."

See, e.g., Schooner's Fear of Oversight: The Fundamental Failure of Business-Like Government. Portions of the abstract are quoted below.

Quote

The article shows that the reformed system couples greatly increased buyer discretion with dramatically reduced oversight of government spending - both internal and external. This article asserts that this combination erodes the public's confidence in the procurement system, violates established norms, and is antithetical to a host of Congressional mandates and policies. ... The article suggests that, despite the success of procurement reform, the current paradigm elevates its facially attractive norms - efficiency and discretion - at the expense of other established, yet apparently undervalued, norms that guide the procurement system, e.g., transparency, integrity, and competition. It cautions that businesslike government has diluted existing internal and external oversight mechanisms and threatened sustained public confidence in the procurement system.

 

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Just now, here_2_help said:

Most of the rhetoric after the acquisition reform efforts of the 90's focused on taking discretion away from contracting officers and ensuring "consistency."

See, e.g., Schooner's Fear of Oversight: The Fundamental Failure of Business-Like Government. Portions of the abstract are quoted below.

 

Now I could be wrong but if memory serves me right the intent of the FAR in its beginning was in part for consistency.  Where, I could as a contractor move from one agency to another and hopefully find a proposed solicitation formed in the same manner -  the Uniform Contract Format.   Not that it matters but in my personal view having the consistency would make it easier (less costly?) for folks to do business with government.  I particularly like my local doctor because she treats me consistently, it is when I stray away from her clinic, her associated primary and have to deal with someone new that frustrates the heck out of me, along with the fact that I spend extra time beyond the actual care matters, which in their own right takes more time to educate the new doctor, but the administrative side on how my personal finances and insurances should pay, will pay, for the care.  Time and time again they do not get it right on the latter and I do feel my time is worth something.

Poor example be it as it may.  Consistency does play an important role in my view.  I will enjoy reading "Fear..." 

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13 hours ago, Neil Roberts said:

FAR 19.000(b) indicates that small business programs apply only in the United States... There is no language therein about "performance."

See also FAR 19.702(b)(3), saying that subcontracting plans are not required for contracts that will be performed entirely outside of the United States and its outlying areas.

 

3 hours ago, Vern Edwards said:

I've been a senior staffer in a four-star military command. In my experience senior people want to take discretion away from COs because they don't like the way the COs have used the discretion. Also, in my experience, most COs have not been truly expert in the matters they handle.

Those Air Force four-star generals lost whatever procurement discretion they once had with the Air Force's decision, for the sake of consistency, to strip them of their "Head of the Contracting Activity" role.

I agree that many or most COs have not been expert in the matters they handle, and I wish it were otherwise -- I want COs to be able to exercise professional discretion in making decisions, rather than being clerks.  To me, many of the calls for consistency seem to be calls for contracting officers to be clerks.

Regarding the original poster's matter of whether performance occurs entirely outside the United States, I don't need more rules (or even clearer rules) -- I can make the call for my procurements with existing text while being flexible enough to be reasonable and to adapt to changing interpretations and rules.  In the context of the original posting, I care about where performance of the contracted services will occur, and not at all about where the contracting office is, where the eventual contractor's home office might be, where the contractor sources its staff or materials, where the CEO goes on his or her vacation, where the contractor's back office functions reside, whether a contractor employee might be paid in U.S. dollars, and so forth.  

Edited by ji20874
correct typo - FAR 19.702...
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37 minutes ago, ji20874 said:

See also FAR 17.702(b)(3), saying that subcontracting plans are not required for contracts that will be performed entirely outside of the United States and its outlying areas.

 

Those Air Force four-star generals lost whatever procurement discretion they once had with the Air Force's decision, for the sake of consistency, to strip them of their "Head of the Contracting Activity" role.

I agree that many or most COs have not been expert in the matters they handle, and I wish it were otherwise -- I want COs to be able to exercise professional discretion in making decisions, rather than being clerks.  To me, many of the calls for consistency seem to be calls for contracting officers to be clerks.

Regarding the original poster's matter of whether performance occurs entirely outside the United States, I don't need more rules (or even clearer rules) -- I can make the call for my procurements with existing text while being flexible enough to be reasonable and to adapt to changing interpretations and rules.  In the context of the original posting, I care about where performance of the contracted services will occur, and not at all about where the contracting office is, where the eventual contractor's home office might be, where the contractor sources its staff or materials, where the CEO goes on his or her vacation, where the contractor's back office functions reside, whether a contractor employee might be paid in U.S. dollars, and so forth.  

Since one won’t subcontract the home office and likely not other support functions and the actual work is performed outside of the US and it’s outlying areas, what would be subcontracted anyway…

 

 

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1 hour ago, ji20874 said:

Those Air Force four-star generals lost whatever procurement discretion they once had with the Air Force's decision, for the sake of consistency, to strip them of their "Head of the Contracting Activity" role.

@ji20874They no longer have the permanent title, but most USAF HCA authorities are delegable. See Air Force MP5301.601(a)(i). Many are delegable down to the Chief of the Contracting Office. Four-stars almost always have discretion, or can get it with a phone call.

1 hour ago, ji20874 said:

I don't need more rules (or even clearer rules).

Who needs more rules? But I prefer clear ones to vague ones. Saves time.

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