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Payment for hourly services under FFP

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Hello everyone - I am a small business contractor SDVOSB (single employee) I found this post that is very similar to my situation here: http://www.wifcon.com/discussion/index.php?showtopic=284

But was advised to start a new post.

1. The contract is FFP and has two items (1)software purchase and (2)consulting services supporting the software implementation. I have been paid for item (1).

2. The contract schedule of supplies/services line item 2: provide expertise and knowledge transfer of products, quantity 2040hrs, unit price $xx per hr, Amount $xxx. I have not been paid for the full amount under item 2.

3. The contract does incorporate by reference 52.212-4 without Alt 1.

4. The contract was awarded as FFP, sole source DVOSB.

5. I did submit monthly reports and invoices based on the actual number of hours worked for the month,per instructions from the project supervisor. However, was not provided enough tasking to use the award amount.

6. The SOW says task orders to be issued by government, services to be performed at the contractor site and delivered to Gov't. The CO who awarded this is not available and I am dealing with a replacement CO.

Contract period has expired. I believe that I am entitled to the remainder of the lump sum award for services that were not utilized since I was available to perform and urged them to utilize my services. I do not have a final CO decision. the remaining amount barely exceeds $100k, I don't have alot of $ to spend chasing this if there is no possibility of prevailing.

looking for sage discussion and options

Thanks

Jose'

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Jose,

If FAR 52.212-4, Alt. 1, applied to item 2, then you only get paid at the hourly rate for each direct labor hour of work performed. This clause applies to T&M contracts. Read the "Payment" paragraph of the clause. You don't get a lump sum for the ceiling amount for being available.

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Jose,

If FAR 52.212-4, Alt. 1, applied to item 2, then you only get paid at the hourly rate for each direct labor hour of work performed. This clause applies to T&M contracts. Read the "Payment" paragraph of the clause. You don't get a lump sum for the ceiling amount for being available.

Don, Thanks for your response. Sorry if I was unclear. There is NOT a reference to FAR 52.212-4, Alt. 1 in the contract; however FAR 52.212-4 is referenced. My understanding from reading other posts on this site is that a Labor Hour contract should have included FAR 52.212-4, Alt. 1. This contract solicitation and award was done in a big rush at end of FY and now the originating CO is gone.

The Payment section of the contract has paragraphs A thru D.

A. Preparation and submittal of invoice shall be in accordance with paragraph (g) of the clause at 52.212-4. para(g) talks about invoicing:

(g) Invoice. (1) The Contractor shall submit an original invoice and three copies (or electronic invoice, if authorized), to the address designated in the contract to receive invoices. An invoice must include....

B. Invoices may be rejected if information is incomplete. Invoices shall identify task order number, purchase order number and period of service....

C. Invoices shall be submitted in arrears monthly....

D. Contractor shall submit invoices to: Government invoice address is provided.

I?ve learned from reading discussion on this site that FAR 52.212-4 also includes a payment paragraph

(i) Payment. (1) Items accepted. Payment shall be made for items accepted by the Government that have been delivered to the delivery destinations set forth in this contract.

Obviously, I am a novice when it comes to contracts. I always thought an FFP placed the loss risks on the contractor but guaranteed payment of the agreed amount. I didn't realize that there is a problem with invoicing on an hourly basis with a FFP contract?

The contract includes a paragraph titled 'Earned Value Management System' that requires tracking and monthly reporting of time spent on the project. It seemed reasonable when I was also told to invoice on an hourly basis.

The FAR 52.212-4 (i) Payment clause - says that payment is required when an item has been delivered and accepted. That makes sense. But, it doesn?t say (to me at least) that an item must be delivered and accepted in order to receive agreed upon payment.

Is there a case or cases that have resolved this? advice, discussion, or comments appreciated.

Thanks in advance for further responses.

Jose

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Jose,

I'm don't know the answer but it appears as if the agency has treated the second line/consulting services of your contract like it was a Labor Hour type. You submitted reports showing the number of hours spent and invoiced the same way.

The fact that the second line specifies a certain number of hours and a unit hourly rate rather then stating something like "one year" or "one lot" tends to make it look more like a Labor Hour agreement.

You mentioned the contract type is stated as FFP. I wouldn't hold a lot of confidence in that because agencies also call LH contracts with fixed price hourly rates as FFP, especially when another part of thye contract clearly is FFP like the software purchase.

Good luck getting this resolved.

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Jose,

I'm don't know the answer but it appears as if the agency has treated the second line/consulting services of your contract like it was a Labor Hour type. You submitted reports showing the number of hours spent and invoiced the same way.

The fact that the second line specifies a certain number of hours and a unit hourly rate rather then stating something like "one year" or "one lot" tends to make it look more like a Labor Hour agreement.

You mentioned the contract type is stated as FFP. I wouldn't hold a lot of confidence in that because agencies also call LH contracts with fixed price hourly rates as FFP, especially when another part of thye contract clearly is FFP like the software purchase.

Good luck getting this resolved.

It is hard to tell without reading the entire contract, but it seems to be a contract for commercial services.

I thought that labor hour contracts, as defined in Part 16, say to pay the full price. You didn't say that this is a labor hour contract and you mentioned that the contract calls for task orders to be placed for the consulting services. That would indicate to me that you'd only get paid for consulting services actually ordered, delivered and accepted, not a lump sum. Unit priced items are common in firm-fixed-price contracts.

But we don't have the full contewxt of the contract. Didn't you say this was a sole-source, negotiated contract? What was the intent of the contract? Why provide for orders for the services if the consulting is to be lump sum?

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It is hard to tell without reading the entire contract, but it seems to be a contract for commercial services.

I thought that labor hour contracts, as defined in Part 16, say to pay the full price. You didn't say that this is a labor hour contract and you mentioned that the contract calls for task orders to be placed for the consulting services. That would indicate to me that you'd only get paid for consulting services actually ordered, delivered and accepted, not a lump sum. Unit priced items are common in firm-fixed-price contracts.

But we don't have the full contewxt of the contract. Didn't you say this was a sole-source, negotiated contract? What was the intent of the contract? Why provide for orders for the services if the consulting is to be lump sum?

Joel ? Obviously, I don?t consider this to be a labor contract. The full contract is 72 pages. This was a last minute (end of FY) procurement of desktop software that I had developed and had been licensing for several years to individual agency users. I received an unsolicited phone call from a senior agency executive (we had worked together previously) asking if I would sell software to the agency and assist them to migrate to a national web platform. We struck a deal over the phone $xxx for the software and $xxx for my consultation to assist in migrating the software.(a package deal) So-the intent of the contract was to procure my software and my proprietary knowledge and assistance.

The executive turned over contracting details to the responsible IT manager. I think much of the problem stems from the IT manager using a ?boilerplate? IT development SOW and projecting that x amount of time would be needed for his shop to migrate the software. I never negotiated over hours. Everything was a last minute rush to beat the end of year deadline. The CO assured me that this was a FFP contract and I would be entitled to the full award amount. My offer stated the full amount as a lump sum.

The procurement was sole source because the software was one-of-a-kind and so was my proprietary knowledge. My consulting services were dependent on the agency?s timetable and effort? thus the need for task orders.

The agency apparently had bigger fish to fry; therefore, they haven?t completed the software project or used me as we agreed. However, the contract period has expired. I no longer own the software and cannot license as before but I haven?t been fully compensated for the software per our agreement.

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Guest carl r culham

My first reaction to reading the entire posted facts is to suggest that you work your issue about what was agreed to through the same chain that started it. In other words call the Senior Exe and ask him/her what they thought the agreement was. Sounds to me that the translation through the differrent hands to get you a specific procurement action is where the issue is, not what you finally ended up with as a purchase order.

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Carl ? thanks for suggestion ?Senior exec has moved on, but I?ll try to contact. I was under the impression that CO could only consider the written contract?

I?m trying to understand and still have questions. Thanks in advance to those willing to render an opinion or point me to an answer.

Joel ? you mention Part16 in your last post and others have suggested that the agency is treating line 2 as LH.? my brief research found restriction for LH contracts in

Subpart 16 authorizes agencies to use LH contracts only when the parties cannot accurately estimate the extent or duration of the contract?s work, or reasonably estimate the costs of the contract, at the time of contracting;the contracting officer prepares a determination and findings (D&F) that ?no other contract is suitable?; and; the contract includes a ceiling price that the contractor exceeds at its own risk.

Subpart 12 agencies may use labor-hour contracts to acquire commercial services only in contracts that were ?competitively? awarded. Additionally, D&Fs must not only conclude that ?no other contract is suitable? Subpart 12 of the FAR imposes additional requirements upon use of time-and-materials and labor-hours contracts to acquire commercial services. Under Subpart 12, agencies may use time and materials and labor-hour contracts to acquire commercial services only under contracts or orders that were ?competitively? awarded. Additionally, under Subpart 12, D&Fs must not only conclude that ?no other contract is suitable? but must also: (1) include a description of the market research that was conducted to reach this conclusion; (2) establish that it is not possible at the time of contracting or ordering to accurately estimate the extent or duration of the work or

anticipate the costs; (3) establish that the requirement has been structured to maximize use of

firm-fixed-price or fixed-price with economic price adjustment contracts in future acquisitions for

the same requirements (e.g., limiting the length of the contract); and (4) describe plans to

maximize the use of firm-fixed-price or fixed-price with economic price adjustment contracts in

future acquisitions.

1. So, since this contract was non-competitive(soleSource) and award process didn?t include items required in Parts 12 and 16, can it be considered a LH contract?

2. It is my understanding that FAR 52.212-4 is required for all commercial contracts, except a LH contract must also include FAR 52.212-4 Alternate I. I previously asked about The FAR 52.212-4 (i) Payment clause - says that payment is required when an item has been delivered and accepted. That makes sense. But, it doesn?t say (to me at least) that an item must be delivered and accepted in order to receive agreed upon payment.

Can anyone provide a cite or cases that have resolved this??

Thanks - and happy Thanksgiving

Jose

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For a contract this big, there should be a written record of the proposal or at least the record of negotiations in the contract file. It should indicate the nature of the proposal and what was agreed to during the phone discussions. I'd try to contact the people that I'd dealt with and attempt to see or have the contracting people review the record to see what was agreed to.

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Guest carl r culham

Jose - Yes, the written contract will prevail in the end so you may well be subject to the current CO's interpretation. The Disputes route is always available but noting all the facts I would carefully consider. Quite candidly one would think that a sole source contract would have been negotiated with a complete meeting of the minds especially on such an important matter. With so many parties now unavailable the only other option I can think of in consideration of the limited facts would be to ask the Contracting Officer to consider Alternative Dispute Resolution such as mediation, etc. to solve the matter.

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It is hard to tell without reading the entire contract, but it seems to be a contract for commercial services.

I thought that labor hour contracts, as defined in Part 16, say to pay the full price. You didn't say that this is a labor hour contract and you mentioned that the contract calls for task orders to be placed for the consulting services. That would indicate to me that you'd only get paid for consulting services actually ordered, delivered and accepted, not a lump sum. Unit priced items are common in firm-fixed-price contracts.

But we don't have the full context of the contract. Didn't you say this was a sole-source, negotiated contract? What was the intent of the contract? Why provide for orders for the services if the consulting is to be lump sum?

Sorry. I was thinking of firm-fixed-price level of effort type contract as described in 16.207, not labor hour.16.207.1 says: "A firm-fixed-price, level-of-effort term contract requires --

(a) The contractor to provide a specified level of effort, over a stated period of time, on work that can be stated only in general terms; and

( :) The Government to pay the contractor a fixed dollar amount."

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It is hard to tell without reading the entire contract, but it seems to be a contract for commercial services.

I thought that labor hour contracts, as defined in Part 16, say to pay the full price. You didn't say that this is a labor hour contract and you mentioned that the contract calls for task orders to be placed for the consulting services. That would indicate to me that you'd only get paid for consulting services actually ordered, delivered and accepted, not a lump sum. Unit priced items are common in firm-fixed-price contracts.

But we don't have the full context of the contract. Didn't you say this was a sole-source, negotiated contract? What was the intent of the contract? Why provide for orders for the services if the consulting is to be lump sum?

Sorry. I was thinking of firm-fixed-price level of effort type contract as described in 16.207, not labor hour. According to 16.207-1:

"A firm-fixed-price, level-of-effort term contract requires --

(a) The contractor to provide a specified level of effort, over a stated period of time, on work that can be stated only in general terms; and

(B) The Government to pay the contractor a fixed dollar amount."

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Sorry. I was thinking of firm-fixed-price level of effort type contract as described in 16.207, not labor hour. According to 16.207-1:

"A firm-fixed-price, level-of-effort term contract requires --

(a) The contractor to provide a specified level of effort, over a stated period of time, on work that can be stated only in general terms; and

(:) The Government to pay the contractor a fixed dollar amount."

Hope everyone enjoyed the holiday

Joel -thanks - based on prior discussions - are you suggesting that this contract could be considered as a firm-fixed-price, level-of-effort term contract?

Carl ? thanks for your comments. This is definitely a learning experience for me. I?ll be sub-ing from now on.

I am surprised that this contract could be considered to be LH with so many omissions and apparent errors. (i.e. missing FAR 52.212-4, Alt. 1, LH must be competitive, LH in excess of $100k must receive higher level approval, advertised and awarded as FFP, bid as lump sum, etc.)

I?m still tracking down the senior exec ? maybe that will be helpful.

It is my understanding that a final decision will be needed to go the dispute route. Should I raise these contract issues with CO at the time I request a final decision or prior to? At what stage is it appropriate to request ADR?

I only have the RFP, contract and emails that I furnished to CO. I don?t know what other documents are in the contract file or are being considered by the CO. Is it appropriate to request copies of all the documents/information that the CO is considering to arrive at the decision ? i.e. a FOIA request? Should that be done prior to a request for final decision?

BTW: I am still confused about interpretation of FAR 52.212-4 (i) Payment clause (required for all commercial items)-I understand that agency will pay for services delivered and accepted. An example: A FFP contract for services over 1yr period of a project , $xxx total award. Would this clause prohibit the contrator from collecting full award if the agency delayed work on the project or constrained contractor from performance?

Thanks

Jose

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Guest carl r culham

Jose - If I were in your shoes I would raise the issues prior to requesting a final CO decision. Suggest a request for equitable adjustment of the contract to start the dialog. I would probably do it two-fold. Submit the request in writing as well as contact the CO to discuss. Also I believe you could raise the question of ADR both prior to and after the decision. Not normal to raise prior to but might suggest your willingness to find a resolution to the matter in lieu of filing under the Disputes Act. You could request the documents through a FOIA but if you get to the Disputes process you could request without a FOIA. You might just ask the CO what the basis is for the route that he/she is taking. Overall what I am suggesting here is effort on your part to attempt to resolve the matter with candid, business like dialog with the CO without having to go the Disputes Act.

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Jose:

It is impossible to tell you what kind of contract you have without looking at the contract in full. Even then it might not be possible to tell with certainty. But it doesn't matter one way or the other. You stated your case as follows:

was not provided enough tasking to use the award amount... I believe that I am entitled to the remainder of the lump sum award for services that were not utilized since I was available to perform and urged them to utilize my services.

That is utter nonsense.

Under an FFP contract you get paid only for work done and accepted. Your issue, if I understand it correctly, is that the government hasn't ordered the remaining $100K worth of work. But even if it turns out that the contract is FFP lump sum, the government doesn't have to give you any more work and doesn't have to pay you the balance. It can simply terminate the contract for its convenience if it doesn't have more work for you or doesn't want to give you more work. Your termination costs will be nil and you can't get profit on work that was not performed. My take on this is that you are probably entitled to little if anything more under that contract, since you are essentially complaining that you have not been given all the work you originally expected to get. The government does not have to give you the remaining work and has a legal way out--termination for convenience. You are not going to get much if any of that remaining $100K.

Standard advice is to sit down with the contracting officer and try to understand what is happening and why. That what Carl suggests and he had given you good advice. Try that. Don't request an equitable adjustment (REA), or submit a claim, and don't file a FOIA request, until you understand what is going on and why and know for sure that you have a right to something and can state the legal basis for that right. REAs and claims should not be used as fishing expeditions. You can get into trouble that way. Moreover, while the contracting officer must treat you fairly, and should explain, he or she has no obligation to educate you in the fundamentals.

I don't know what your relationship with your customer is at this point. However, if you and the customer generally had a good experience, what you are doing now is making yourself a pain in the butt and reducing your chances of getting more business in the future. A FOIA request will make you a REALLY BIG pain in the butt. Face it--you signed a contract without knowing what you were doing, and you don't know what you are doing now. Government contracts are not for the ill-informed and unprepared.

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Jose:

It is impossible to tell you what kind of contract you have without looking at the contract in full. Even then it might not be possible to tell with certainty. But it doesn't matter one way or the other. You stated your case as follows:

That is utter nonsense.

Under an FFP contract you get paid only for work done and accepted. Your issue, if I understand it correctly, is that the government hasn't ordered the remaining $100K worth of work. But even if it turns out that the contract is FFP lump sum, the government doesn't have to give you any more work and doesn't have to pay you the balance. It can simply terminate the contract for its convenience if it doesn't have more work for you or doesn't want to give you more work. Your termination costs will be nil and you can't get profit on work that was not performed. My take on this is that you are probably entitled to little if anything more under that contract, since you are essentially complaining that you have not been given all the work you originally expected to get. The government does not have to give you the remaining work and has a legal way out--termination for convenience. You are not going to get much if any of that remaining $100K.

Standard advice is to sit down with the contracting officer and try to understand what is happening and why. That what Carl suggests and he had given you good advice. Try that. Don't request an equitable adjustment (REA), or submit a claim, and don't file a FOIA request, until you understand what is going on and why and know for sure that you have a right to something and can state the legal basis for that right. REAs and claims should not be used as fishing expeditions. You can get into trouble that way. Moreover, while the contracting officer must treat you fairly, and should explain, he or she has no obligation to educate you in the fundamentals.

I don't know what your relationship with your customer is at this point. However, if you and the customer generally had a good experience, what you are doing now is making yourself a pain in the butt and reducing your chances of getting more business in the future. A FOIA request will make you a REALLY BIG pain in the butt. Face it--you signed a contract without knowing what you were doing, and you don't know what you are doing now. Government contracts are not for the ill-informed and unprepared.

Vern, don't sugar coat it, just tell me what you think. I appreciate your opinions and Carl's advice. I will continue to discuss with the new CO.,

Yes, I did sign a contract without fully understanding the customer's intentions and it looks like the original CO produced a contract full of errors.

As far as not knowing what I am doing now, you are spot on - that's why I'm asking questions on this site.

I don't expect any more business from this customer and don't want any. I do expect fair/honest treatment by the customer and if I can't get that, I don't mind being a PITA.

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.

Jose,

find someone you trust who understands government contracts, and ask them to read your contract and tell you what it says.

If it was truly for a lump sum to install/migrate the software, and if you were kept from complying due to the Government's actions or inactions, then you may be able to get full payment. In such a situation, I would expect the contract to state a monthly amount, or a single lump sum amount, not an hourly amount.

On the other hand, if you have a contract for services at an hourly rate, and you work as the government orders those services, and if that "lump sum" is really a maximum amount, not an estimated amount or a total amount, the contract may have been executed just as it reads.

But I don't understand you not getting paid in full for the software. If you delivered, you should have invoiced and got paid.

anyway, there's an expert on government contracts in every town.

If you told the CO when you first signed the contract that the terms were not what you agreed to, but you signed it anyway, guess what ?

you agreed to the terms in the document you signed, regardless of any other verbal agreement.

Mee-ahn-eh-yo. Sorry 'bout that.

Maybe you should have that someone who understands contracts read your next one before you sign it. There's no shame in not being an expert in every field. It's just smart to hire expertise in fields where you are lacking.

.

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1. So, since this contract was non-competitive(soleSource) and award process didn?t include items required in Parts 12 and 16, can it be considered a LH contract?

Jose - Just curious. How do you know the award process didn't include the required LH D&F? The D&Fs would not be part of the contract, but instead resides in the Government's contract file. Since it was sole-source, the CO would have written a document supporting the sole source and could have easily written the labor hour D&F at the same time

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It doesn't matter what type of contract it was: fixed-price, cost-reimbursement, T&M, L-H, or jabberwocky. Jose's complaint is that he wasn't given all of the work he had hoped to get. So what? Unless the CO is an idiot, Jose is not going to get paid for work that he did not do. All the government has to do is T for C.

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It doesn't matter what type of contract it was: fixed-price, cost-reimbursement, T&M, L-H, or jabberwocky. Jose's complaint is that he wasn't given all of the work he had hoped to get. So what? Unless the CO is an idiot, Jose is not going to get paid for work that he did not do. All the government has to do is T for C.

Its appears that the contract isn't written the way that Jose understood the deal made over the phone. I believe that Vern is right. The Government will likely be able to get out of paying the remainder of the services portion of the contract.

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Hello everyone - I am a small business contractor SDVOSB (single employee) I found this post that is very similar to my situation here: http://www.wifcon.com/discussion/index.php?showtopic=284

But was advised to start a new post.

1. The contract is FFP and has two items (1)software purchase and (2)consulting services supporting the software implementation. I have been paid for item (1).

2. The contract schedule of supplies/services line item 2: provide expertise and knowledge transfer of products, quantity 2040hrs, unit price $xx per hr, Amount $xxx. I have not been paid for the full amount under item 2.

3. The contract does incorporate by reference 52.212-4 without Alt 1.

4. The contract was awarded as FFP, sole source DVOSB.

5. I did submit monthly reports and invoices based on the actual number of hours worked for the month,per instructions from the project supervisor. However, was not provided enough tasking to use the award amount.

6. The SOW says task orders to be issued by government, services to be performed at the contractor site and delivered to Gov't. The CO who awarded this is not available and I am dealing with a replacement CO.

Contract period has expired. I believe that I am entitled to the remainder of the lump sum award for services that were not utilized since I was available to perform and urged them to utilize my services. I do not have a final CO decision. the remaining amount barely exceeds $100k, I don't have alot of $ to spend chasing this if there is no possibility of prevailing.

looking for sage discussion and options

Thanks

Jose'

I quoted Jose's original post and highlighted the key passage. He had some kind of service contract to provide 2,040 hours of "expertise and knowledge transfer." He said he hadn't been paid the full amount. He later points out that work was to be ordered as needed by issuance of task orders and that he wasn't tasked to do enough work to earn the $100K remaining on the line item. He wants that balance and he somehow thought that the type of contract (pricing arrangement) is a key factor in his entitlement to the balance. It isn't, and someone should have pointed that out to him right away. Instead, what begins is a long speculation as to the type of contract his contract may have been.

What kind of analysis could have been made. Piecing Jose's post together it appears that the services line item was IDIQ, with which was associated a number of 2.040 hours and a unit price. The fact that it was IDIQ belies any notion that the line item itself stipulated a lump sum price for 2,040 hours. One would have to look to each order for the pricing arrangement. But let's suppose that the line item was for a single job with a lump sum firm-fixed price. So what? The government could T for C. Let suppose that the government somehow breached the contract by not letting Jose work. Even then, Jose would be entitled to no more than compensatory damages. Presumably, since the line item is for services, he incurred little or no costs associated with the remaining $100K, so the most he could hope for is anticipated profits, to the extent that he could reasonably prove the amount. But this is pointless, since it seems clear that the line item was IDIQ, and that the total amount associated with the line item was not a lump sum price.

Next thought -- was there a minimum associated with the service line item and did the government buy it? Since Jose makes no mention of a minimum, I assume that there wasn't one. One would not have been needed, since the product delivery line item provided sufficient consideration to bind the contractor to the services line item. Thus, absent a minimum the government was not obligated to buy any hours under the services line item, no matter how it was priced. Jose has no claim. But suppose that there had been a minimum: failure to buy it or to terminate the contract for convenience before it expired would have entitled Jose to no more than damages, not to the entire amount of the minimum. See Professor John Cibinic's discussion of the case law in "Compensation for Government's Failure to Order Minimum Quantity: Driving A Stake Into Maxima's Heart," 16 N&CR ? 27 (June 2002).

Bottom line: As a general rule, the government is not obligated to pay a contractor the stipulated price for work that was not done. People here got distracted by the type of contract question, without realizing that it had nothing whatsoever to do with Jose's main issue, which was how he could get his hands on that remaining $100K even though he had not done any work associated with it. I can think of no circumstances in which, under a government contract, Jose would be entitled to the entire dollar value of something that he did not provide. I'm astonished that no one told him that a week ago.

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Vern,

I think the problem is Jose thought he had one type of contract (firm fixed price for providing one year of consulting support) while the contract language shows is a labor hour type. Here's Jose's comments again with my emphasis added as boldface

Joel - Obviously, I don?t consider this to be a labor contract. The full contract is 72 pages. This was a last minute (end of FY) procurement of desktop software that I had developed and had been licensing for several years to individual agency users. I received an unsolicited phone call from a senior agency executive (we had worked together previously) asking if I would sell software to the agency and assist them to migrate to a national web platform. We struck a deal over the phone $xxx for the software and $xxx for my consultation to assist in migrating the software.(a package deal) So-the intent of the contract was to procure my software and my proprietary knowledge and assistance.

The executive turned over contracting details to the responsible IT manager. I think much of the problem stems from the IT manager using a ?boilerplate? IT development SOW and projecting that x amount of time would be needed for his shop to migrate the software. I never negotiated over hours. Everything was a last minute rush to beat the end of year deadline. The CO assured me that this was a FFP contract and I would be entitled to the full award amount. My offer stated the full amount as a lump sum.

So I think Jose believed he had an agreement to support migration of the software for a fixed amount. Somehow an estimated number of hours came into play and the contract language that was created showed something different. Shame on Jose for not making it clearer and acting over the past year that as if it was a labor hour contract by billing that way and providing status reports for the time spent. Also a new CO takes over the contract and the only conclusion he/she can reach is what the contract language obviously shows.

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formerfed:

Here is what Jose said in his first post:

I did submit monthly reports and invoices based on the actual number of hours worked for the month,per instructions from the project supervisor. However, was not provided enough tasking to use the award amount... I did submit monthly reports and invoices based on the actual number of hours worked for the month,per instructions from the project supervisor. However, was not provided enough tasking to use the award amount.

He knew he had not done enough work to earn the entire amount of the line item. He was bothered by that fact and thought that it was wrong and would be grounds for "recovery."

This is a textbook example of how small businesses get all excited at the prospect of winning a government contract and making the big bucks, but are often entirely unprepared to cope with what is going to happen to them. And it shows why some COs are reluctant to get involved with small businesses. Clueless, they show up at the office, ignorant, and indignant over something that has happened to them. But I'm a small business! You can't do this to me! Many contracting officers are equally clueless, and are either proceeding inappropriately or cannot furnish a coherent explanation for appropriate action. What a system.

It raises an interesting question: Could obvious ignorance of government contracting rules and processes be grounds for a determination of nonresponsibility? Probably not, but it ought to be.

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Vern,

Yeah, that statement makes my thinking wrong. So he's now trying to find a way to get paid for the extra work he didn't do.

Yes, and I can understand that. He's small, he was expecting to get the money, now he won't, but he's trying to figure out what happened and see if there isn't a way to earn some more. I don't think he's trying to get away with anything. When you're small and big jobs are few and far between, you're looking for a way to make a living, and you get your hopes up.

If I thought it would do any good I would warn small businesses away from government contracts. Yes, they can be lucrative if (1) you know what you're doing and (2) you're lucky. But if anything goes wrong, and if the contract is big enough, you're going to have trouble, maybe big trouble, especially with cash flow. And many small businesses find that the government, like the Martians in H.G. Wells's War of the Worlds, is "vast and cool and unsympathetic."

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