Time and Material

[DOECPA]

My question has to do with time spent reviewing drawings, specifications, tech manuals and preparing pre & post travel documentation. A Time & Material Contract was issued for specific labor classifications, subject to SCA, to perform ?Fielding? of equipment and vehicles. This is a sustainment contract, hours being used faster than anticipated, and has short notice mission requirements. I read Vern Edwards Article ?The Time And Materials Contract?, and it is as if he was directing the article to my particular situation. On a sustainment contract, when an employee is idle or not on ?Fielding? travel, they may be studying tech data or performing work that is allocable. It appears to me that only a floor audit would determine if they were performing allocable work or just goofing off on personal business. My position, is that the Contractor and Government need to determine how many FTE?s is acceptable and that its not an employees fault if he or she does not have enough to do to keep busy.

Would a Cost Plus Incentive Fee Contract work in this type scenario and how would the Incentive Fee Work.

Thank You

[DOECPA]

Would it be feasible to design a solicitation where Offerors could bid a average time to complete a function within a reasonable range and use this Proposed Time as a Ceiling. If the successful offeror, after award, could complete the function in less than the "average time" that they would share in the cost savings as a function of time. Let's say I want you to perform between 500 and 1000 transmission checks in various locations. (The travel component would be Cost Reimbursement). The successful Offeror includes the time to perform the transmission checkout plus estimated time to be spent reviewing drawings, specifications, tech manuals and preparing pre & post travel documentation. Bids 4.5 Hours per Transmission Check which becomes ceiling, $75.00 per hour (Average Composite Rate), and sharing ratio for incentive is 50/50. Actual time comes to 3.5 Hours for 1,000 oil changes.

Because Fixed Price Incentive functions like Cost Plus Incentive, the Ceiling would have been $337,500 and the actual would be $262,500. Saving of $75,000 split half ways to both ($37,500) If Contractor had just billed the Ceiling they would leave $30K in Profits on the Table assuming they were around 10% and made $7,500. Anyone know if this could work?

[FAR Fetched]

If the Contractor controls the time spent on the project from start to finish, an Incentive Fee works great. Think of a contract to build a road through a grass field a mile long; if the contractor finishes early, they'll get the incentive fee, if they're late they'll just incur unbillable cost (or even a penalty). The Contractor controls and is responsible for obtaining and managing labor/materials and there's only one sign-off at the end of the project; either the road is done early, on time or late. It's very easy to quantify an incentive fee in that scenario.

The problem with the work you're describing is (I'm guessing) the Contractor doesn't control the time spent working from start to finish.

Questions about trying to do this with an Incentive Fee:

• Will the Contractor have full access to the equipment and vehicles at all times or will they require to Government access it?
  
• What happens when the Contractor shows on time and the equipment and/or vehicles aren't ready for servicing?
  
• Is the equipment homogeneous?
  

It sounds like a very small contract that could turn into a lot of micro-managing de minimis costs and a constant documentation required on the part of both Gov and Contractor to figure out what time should/shouldn't be applied to their potential profits.

[boricua]

You should also consider that there is plenty of data on how much time it takes to perform the different types of vehicle maintenance so you could possibly make it a FFP with the CLINs looking something like this:

0001 Car Model A Oil change Qty 100 $

0002 Car Model B Oil change Qty 100 $

0003 Car Model A Lube service Qty 100 $

0004 Car Model B Lube Service Qty 100 $

The key for this is to group the services, and deciding if the government will provide the oil, grease, etc. The government maintenance personnel should be able to assist you. You can also include T&M CLIN for unscheduled maintenance if needed.

Dan (new to Gov Contracting)