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FAC 2005-48 & ID contracts under Subpart 19.10

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FAC 2005-48 removes FAR Subpart 19.10, effective 1/31/11. Won't this create a problem awarding task orders against certain previously awarded IDIQ contracts?

For example, we have several multiple year A&E contracts awarded to large businesses. The contracts were competed on an urestricted basis following procedures in Subpart 19.10. They are used to award task orders for requirements above the ESB reserve amount ($50K for A&E). When Subpart 19.10 goes away we must begin following Subpart 19.5, which requires automatic SB set asides for requirements between $3K and $150K (see 19.502-2(a)) and CO determined set asides for requirements above $150K (see 19.502-2(:lol:). Following Subpart 19.5, instead of 19.10, will not allow us to use these contracts for their intended purpose.

Thoughts?

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After scanning the FAC in question, it looks like the authority to award task orders under Subpart 19.10 is gone as of the end of the month.

While looking around at the references, it struck me that there would not be a reasonable expectation that a "demonstration program" would last forever, and this one seems to have had a rather long life, considering that it was based on the Business Opportunity Development Reform Act of 1988.

So, what to do? T for C? Or cop out: just not solicit any more work under the IDIQs and let them expire?

It would make sense, at least to me, to deal with it now, be forthright with your contractors, and work with them to close out a contract while it's fresh, rather than letting it wither on the vine and working closeout when all your institutional recollection of the contract is gone.

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Guest carl r culham

With reference Delex Sys., Inc., B-400403 I want to pose some thoughts to enhance the discussion.

My read is that the competition intended is among only those contractors on a specific IDIQ multiple award. With this in mind if you have IDIQ that that was solicited full and open and you ended up with no small businesses on it, then there are no small businesses available to receive the award therefore you cannot set aside the procurement for SBs or apply the "Rule of Two". However if you do have SB's in the IDIQ mix then you must reserve the procurement for the pool of SB's if need is under $150K and consider Rule of Two if need is over $150K.

What would add confusion are further details of your procurement and the concept of IDIQ's themselves. They are not a mandatory use so one might argue if you have only LB's on them you cannot even get to their use at all. I would offer that if your decision to do full and open was not solely based on FAR 19.10 but more detailed market research that supported that there were not adequate SB's in the market to fill all your needs, and the solicitation proved it where no SB?s got on the IDIQ contract, you might have adequate grounds to continue their use.

In the end you have raised a very interesting question that carries great risk of being the first test case(s) for GAO protest. Worth the risk to continue with the IDIQs? Your choice the way I see it? To the mention of T4C such action would only be appropriate in my view for those contractors on the IDIQ that have not received the guaranteed minimum in TO awards. Do not forget that the no cost settlement route might be an option as well.

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One of the problems is that under 19.10 I didn't consider SB set asides, as 19.10 allowed unrestricted procurments over the ESB reserve amount. So we went out unrestricted. I going off memory but I believe we had many SB's (some submitted as JV's and using teaming arrangements) that submitted SF-330's but they didn't make the most highly qualified list. From my experience most large A&E firms have an advantage over SB firms becuase they have more resources and broader capabilities (IMHO). So while SB firms may be capable to perform the work, they may not be able to surpass their LB counterparts in experience and capablity (at least on paper).

I don't think this change will have a big effect on the other DIGs, like construction, but for A&E it may have some far reaching changes. The work load of the SB A&E community should significantly increase (IMHO).

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Guest carl r culham

alex - Not to get to far into the weeds here but it seems your last comments are making conclusions that you could only make from actual evaluation of SF-330's. Suggest not to over think but to work thorugh the matter in a logical step process. Why did I do a full and open? How does this affect the new statute? Etc? Etc?

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If an IDIQ contract was awarded in compliance with the laws and regulations then in effect, and if a new requirement is within the scope of that contract, then the requirement need not be competed except as required by FAR Subpart 16.5, which is about competition restricted to awardees of multiple award IDIQ contracts. See FAR 6.001(e) and (f). See also FAR 5.202(a)(6) and (11). If the work need not be competed, then it need not be set-aside under 19.5. There is no need to revisit the set-aside issue for work that is within the scope of a legally awarded contract.

This is a non-issue.

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If an IDIQ contract was awarded in compliance with the laws and regulations then in effect, and if a new requirement is within the scope of that contract, then the requirement need not be competed except as required by FAR Subpart 16.5, which is about competition restricted to awardees of multiple award IDIQ contracts. See FAR 6.001(e) and (f). See also FAR 5.202(a)(6) and (11). If the work need not be competed, then it need not be set-aside under 19.5. There is no need to revisit the set-aside issue for work that is within the scope of a legally awarded contract.

Vern,

Consider LBM, Inc., Comp. Gen. Dec. B-290682, 2002 CPD ? 157.

Nevertheless, the Army argues that FAR Sec. 19.502-2(B) (the so-called "rule of two") does not apply to task orders issued under FAR Subpart 16.5, but only to acquisitions under FAR Parts 13, 14, and 15. See Army Response to SBA Report (Aug. 2, 2002) at 4-7. In the agency's view, FAR Sec. 19.502-2 only applies "in the contract formation part of the acquisition process," and not to "a post-award ordering action."

[...]

We find unpersuasive the Army's arguments, which mischaracterize the protest as a challenge to the proposed award of a task order under the existing LOGJAMSS contracts. As explained above, LBM's challenge is to the agency's acquisition planning in deciding to transfer the Fort Polk motor pool transportation services to LOGJAMSS without considering applicable law and regulation pertaining to small businesses.

Also, contrary to the Army's arguments, we believe that FAR Sec. 19.502-2(B) applies to the Army's acquisition of the motor pool services at Fort Polk. By its express terms, FAR Sec. 19.502-2(B) states that "the rule of two" is applicable to "any acquisition over $100,000." Acquisition is defined by the FAR to mean:

the acquiring by contract with appropriated funds of supplies or services (including construction) by and for the use of the Federal Government through purchase or lease, whether the supplies or services are already in existence or must be created, developed, demonstrated, and evaluated. Acquisition begins at the point when agency needs are established and includes the description of requirements to satisfy agency needs, solicitation and selection of sources, award of contracts, contract financing, contract performance, contract administration, and those technical and management functions directly related to the process of fulfilling agency needs by contract. FAR Sec. 2.101.

Under this broad definition, the agency's purchasing the Fort Polk motor pool services by contract with appropriated funds is an "acquisition," subject to FAR Sec. 19.502-2(B), regardless of the fact that the agency anticipated acquiring those services through their transfer to the LOGJAMSS scope of work. See Valenzuela Eng'g, Inc., supra (Letter to the Acting Sec'y of the Air Force, Jan. 26, 1998, at 2-3 n.1). Had the agency complied with the requirements of FAR Sec. 19.502-2(B), it might have concluded that the LOGJAMSS contracts were not the appropriate vehicle for this acquisition. Whatever the outcome of the FAR Sec. 19.502-2(B) analysis, though, the agency's intent to use a task order under LOGJAMSS as the contract vehicle did not eliminate the legal requirement that the agency undertake that analysis.

I think that this would be an issue. In the past alexreb didn't have to consider small business set-asides because they were under the Comp Demo Program. Now he (or she) does.

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If LBM decision applies then it is a "legal requirement" for a CO to consider ALL acquisitions under 19.502-2(B).

This issue doesn't appear to be clear cut by any means, my PCR is under the opinion that we should be able to continue awarding task orders under our current contracts (by-passing 19.502-2(B) determination). But he also mentioned that we should consider letting our contracts expire and going out for new awards.

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If LBM decision applies then it is a "legal requirement" for a CO to consider ALL acquisitions under 19.502-2(B).

This issue doesn't appear to be clear cut by any means, my PCR is under the opinion that we should be able to continue awarding task orders under our current contracts (by-passing 19.502-2(B) determination). But he also mentioned that we should consider letting our contracts expire and going out for new awards.

alexreb,

What is your PCR basing their opinion on?

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Don:

You are guilty of a very selective or careless reading of the LBM decision, which was rendered in light of a very specific set of facts. In that case, motor pool services at Fort Polk had been acquired as a small business set-aside for 10 years.

Transportation motor pool services, including among other things dispatching and operating vehicles and minor maintenance, have been performed exclusively by small businesses, including LBM, under small business set-asides at Fort Polk over the last 10 years. The most recent contract for these services was awarded to another small business concern in 1997 and expired on July 31, 2002 (after the date this protest was filed).

The Army then decided that instead of conducting another small business set-aside for the follow-on contract, it would order the work under a large task order contract for logistics services (LOGJAMSS).

The contracting officer estimated that the Fort Polk motor pool services requirement would be approximately $10 million for the total 5-year performance period. This is in contrast to the more than a quarter of a billion dollars that has already been ordered under the LOGJAMSS contracts.
Footnote and file references omitted.

The GAO objected to the "transfer" (GAO's word) of the work to a very large task order contract with a "broad and vague" workstatement.

We have recognized that the increasing use of ID/IQ contracts with very broad and often vague statements of work may place an unreasonable burden upon potential offerors, who may be required to guess as to whether particular work, for which they are interested in competing, will be acquired under a particular ID/IQ contract. See Valenzuela Eng?g, Inc., B-277979, Dec. 9, 1997, 98-1 CPD ? 51 (Letter to the Acting Sec?y of the Army, Jan. 26, 1998, at 2). This burden may be particularly problematic for small businesses... In sum, we find, given the breadth and vagueness of the LOGJAMSS scope of work and given that the Fort Polk motor pool services had previously been exclusively set- aside for small businesses, that LBM cannot reasonably be viewed as on notice that the Army would transfer this work to LOGJAMSS without consideration of FAR ? 19.502-2(B).

None of the facts in LBM pertain in alexreb's case, which is clearly distinguishable. The work had not been previously awarded to small businesses. In fact, set-aside for small businesses had been prohibited. Thus, alexreb is not transferring work that had previously been acquired under small business set-aside to a different contract that had not been set aside. We have not heard that alexreb's statement of work is "broad and vague," encompassing many different kinds of work, as was the case in LBM. His contract is for A-E services. The GAO did not rule that COs must always consider small business set-asides before acquiring work under a contract that had been awarded for the work in question. They applied that requirement in the LBM decision in light of a very specific set of facts, which do not pertain in alexreb's case. Anyway, this is a typical GAO decision in which GAO was seeking justice and bent law and regulation to its purposes.

Alexreb--get on with your work and quit worrying about this. You have gotten mainly idle speculation here. I got this from a friend at DAU today:

A lot of the feedback we're getting from program managers/project officers about their contracting support, beyond just that they are new and inexperienced, is that they are too timid, afraid of their own shadows, and, ultimately, almost paralyzed. As one example, on a mission assistance effort we did for PEO Soldier, one program manager complained about the contracting officer refusing to allow him to do one-on-ones with potential offerors as part of market research, even though it is specifically allowed by the FAR. We hear over and over again about contracting officers afraid of protests, and how much time they take trying to make their source selections ?protest proof.? [Good luck on that one.] They are, of course, ignorant of, or chose to ignore, the minimal statistical likelihood that they will be involved in a protest, much less lose one. By the way, part of the feedback I get is that some of this fear may be inculcated by novice DoD attorneys with even less acquisition experience than the contracting officers.

Don't be a classic case.

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Vern,

The facts of the case are irrelevant to GAO's major premise, which is that the rule of two applies to all acquisitions, regardless of whether the agency plans to use an IDIQ contract or not. The use of FAR 16.5 to place an order does not insulate an agency from having to comply with the rule of two. To assume that the GAO would interpret the rule differently if given a different set of facts is unreasonable.

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The facts of the case are irrelevant? Nonsense.

Let me ask you:

Is it your position that an agency must first decide whether to set a purchase aside for separate small business competition before it can issue a task or delivery order for the work against an IDIQ contract, and that the agency may not use the IDIQ contract, but must conduct a separate competition as a small business set-aside if two small businesses are able to perform, even if the purchase is within the scope of the IDIQ contract?

If that is your position, do you believe that it holds true even if the agency needs to issue an order so that it can buy the contract minimum, and that an agency can be prevented from ordering the minimum accordingly?

If that is not your position, what is your position?

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Vern,

In holding that the rule of two applied even when an agency intended to use FAR Subpart 16.5, the only relevant fact of the LBM case was that the Army was conducting an acquisition. They didn't limit their interpretation of FAR 19.502-2(B) to cases where an agency is "transferring" a requirement that had traditionally been set-aside to an IDIQ with a vague statement of work. Here it is again:

Also, contrary to the Army's arguments, we believe that FAR Sec. 19.502-2(B) applies to the Army's acquisition of the motor pool services at Fort Polk. By its express terms, FAR Sec. 19.502-2(B) states that "the rule of two" is applicable to "any acquisition over $100,000." Acquisition is defined by the FAR to mean:
the acquiring by contract with appropriated funds of supplies or services (including construction) by and for the use of the Federal Government through purchase or lease, whether the supplies or services are already in existence or must be created, developed, demonstrated, and evaluated. Acquisition begins at the point when agency needs are established and includes the description of requirements to satisfy agency needs, solicitation and selection of sources, award of contracts, contract financing, contract performance, contract administration, and those technical and management functions directly related to the process of fulfilling agency needs by contract. FAR Sec. 2.101.

Under this broad definition, the agency's purchasing the Fort Polk motor pool services by contract with appropriated funds is an "acquisition," subject to FAR Sec. 19.502-2(B), regardless of the fact that the agency anticipated acquiring those services through their transfer to the LOGJAMSS scope of work. See Valenzuela Eng'g, Inc., supra (Letter to the Acting Sec'y of the Air Force, Jan. 26, 1998, at 2-3 n.1). Had the agency complied with the requirements of FAR Sec. 19.502-2(B), it might have concluded that the LOGJAMSS contracts were not the appropriate vehicle for this acquisition. Whatever the outcome of the FAR Sec. 19.502-2(B) analysis, though, the agency's intent to use a task order under LOGJAMSS as the contract vehicle did not eliminate the legal requirement that the agency undertake that analysis.

As to your question...

Is it your position that an agency must first decide whether to set a purchase aside for separate small business competition before it can issue a task or delivery order for the work against an IDIQ contract, and that the agency may not use the IDIQ contract, but must conduct a separate competition as a small business set-aside if two small businesses are able to perform, even if the purchase is within the scope of the IDIQ contract?

It depends. If, at the time of the solicitation for the IDIQ contract, small business concerns were reasonably aware that the types of supplies or services contemplated by the particular task or delivery would be types of supplies or services ordered under the IDIQ contract, then an agency need not consider that requirement for a small business set-aside (assuming they considered the rule of two when soliciting offers for the IDIQ contract). In this case, a protest of the agency's decision to issue a task or delivery order would be untimely. However, if, at the time of solicitation for the IDIQ contract, small business concerns would not have reasonably been aware that the types of supplies or services contemplated by the particular task or delivery would be the types of supplies or services ordered under the contract, then the agency would have to consider the requirement for a small business set-aside. Such was the case in LBM.

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You contradict yourself by saying that the only relevant fact is that the agency was conducting an acquisition and then saying:

It depends. If, at the time of the solicitation for the IDIQ contract, small business concerns were reasonably aware that the types of supplies or services contemplated by the particular task or delivery would be types of supplies or services ordered under the IDIQ contract, then an agency need not consider that requirement for a small business set-aside (assuming they considered the rule of two when soliciting offers for the IDIQ contract).

First you say that the only relevant fact is whether the agency is conducting an acquisition, then you say that the application of the rule of two depends on the awareness of small businesses when proposals for the IDIQ contract were solicited. Those positions are inconsistent.

In LBM the GAO found that the protester could not have known at the time of the solicitation for the task order contract that the services would be transferred to that contract, because at the time of the award of the task order contract the work in question was being done and had been done by small businesses under contracts that had been set aside. It was the transfer of work to the previously awarded task order contract that could not have been anticipated and that triggered FAR 19.502-2(B):

It was only at the point that the agency decided to withdraw the Fort Polk motor pool services from the small business set-aside program and to transfer them to the LOGJAMSS contracts that the analysis required by applicable regulations, that is, as discussed below, FAR ? 19.502-2(B), became relevant.

Subsequent to LBM, in Specialty Marine, Inc., B-293871, June 17, 2004, 2004 CPD ? 130, the GAO said:

[W]e view the protest as a challenge to the inclusion of the work under the ID/IQ contracts, in essence, a challenge to the scope of the underlying ID/IQ solicitation, an issue that is within our bid protest jurisdiction. See LBM, Inc., B-290682, Sept. 18, 2002, 2002 CPD ? 157 at 4.

Emphasis added.

In short, LBM was a challenge to the transfer of the work, which could not have been contemplated when proposals for the task order contract were solicited. The transfer was thus outside the scope of the task order contract competition. It was a "new work" acquisition that was subject to the rule of two. Facts do matter. It is new work acquisitions that are subject to the rule of two. The GAO did not hold that work within the scope of an existing IDIQ contract is subject to the rule. The position you took in your previous post, which was that the rule of two applied even to within scope work, would have rendered IDIQ contracts pointless. Two small businesses could submit proposals for an IDIQ contract and not be selected and then force separate set-asides for work within the scope of the very contract for which they were not selected. Absurd.

axelreb's situation is distinguishable from that in LBM. The work that he wants to order was contemplated for the IDIQ contract at the time of solicitation and is within the scope of that competition and contract, and thus is not subject to the rule of two. The elimination of FAR 19.10 is without effect on that contract.

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Guest carl r culham

Following the thread I have changed my mind where if I were alex I would terminate the contracts and start new. Why?

By example if an IDIQ contract was awarded under a statute that allowed selection of A-E contractors based on price and during the term of that contract the statute changes where the Brooks Act became reality appropriate course would be to terminate the IDIQ's and start new.

So spinning back to the FAR 19.10 the contracts should terminated in light of new legislation. The statute change that eliminates FAR 19.10 is not a scope issue it a legislative action that must be considered. Amending is not appropriate because as alex has noted a SB set aside was not even considered for the original contracts in light of 19.10. Yes it was a full and open competition where SB's did try to play but could not compete against the LB's and suggests the prime reason the demo program has been removed.

Now the "law" if you will, by removal of the demo program, is that a SB set aside must be considered for all A-E procurements. An IDIQ is not a mandatory source. Further a task order is a standalone contract action. As such a CO must make a decision regarding the SB set aside ?law? because no longer does FAR 19.10 exist that in essence allowed the CO to quickly and almost automatically get to a full and open and in effect to the tool of the IDIQ that was advertised as full and open.

Summarized an A-E procurement is now subject to the either mandatory SB set aside or the ?Rule of Two?, in this instant matter the use of the IDIQ does allow for this statutory consideration for any new procurements that would be accomplished by task order and therefore is not an appropriate tool to be used.

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This is amazing to me. In the long history of government contracts, within-scope acquisitions have not been subject to the rules that apply to "new work" acquisitions, and statutes have not been applied retroactively to legally awarded contracts unless the statute or regulation expressly provides otherwise. Now we have a DAU professor and an experienced hand seeking to overturn longstanding practice. At least in the case of the DAU professor I know where he has been coming from⎯misreading of a single GAO decision. But in Carl?s case I just don?t get it:

The statute change that eliminates FAR 19.10 is not a scope issue it a legislative action that must be considered.
[sic.]

Huh? A new statute applies to work that is within the scope of a legally awarded contract that predated the statute? Since when? Such a notion if actually applied would destabilize the entire acquisition system.

Don?s earlier notion, that the rule of two applies to all acquisitions, even within scope orders against legally awarded contracts, would eliminate the rationale for IDIQ contracts and make them untenable. In a conversation he even maintained that if two small businesses could do the work, then the agency could not issue an order against the contract even to buy the minimum. Maybe he still thinks that, I'm not sure.

Excuse me, but this is lunacy. If axelreb's office wants to terminate the contract so that they can make more small business awards, that's okay. But it they want to terminate the contract because they think that the elimination of FAR 19.10 requires that they do so, that's not okay. That's wrong. The background statement to that change in FAR says it is not a significant action, and it says nothing about no longer ordering against existing contracts.

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Vern,

I didn't contradict myself--you misunderstood. I'll try to be more clear. According to LBM, the rule of two applies to acquisitions regardless of whether the agency intends to issue a task or delivery order under an IDIQ contract. Period. If an agency wishes to place an order under an IDIQ contract for work that could have reasonably been contemplated by small business concerns at the time of solicitation of the IDIQ contract, then they need not reconsider that work for a small business set-aside assuming they complied with FAR 19.502-2(B) in awarding the IDIQ contract. They would have complied with FAR 19.502-2(B) for all future task and delivery orders that could have been reasonably contemplated by small business concerns at the time of the IDIQ solicitation. The GAO would dismiss as untimely a protest against such a task order on the grounds that it should be set aside for small business.

On the other hand, if the agency wishes to place an order that could not have reasonably been contemplated by small business concerns at the time of the IDIQ solicitation, then they would have to consider that work for a set-aside before placing the order. Such orders could still be within the scope of the IDIQ contract. In LBM, there is no indication that the motor pool services were outside the scope of the contract. Given the description of the LOGJAMMS statement of work as "broad" and "vague", it probably was within the scope of the contract. As such, I don't accept your contention that an agency need not worry about the rule of two if the order it contemplates is within the scope of the contract. If you meant "scope of the task order contract competition" when you wrote "scope of the contract", then your position would be more acceptable.

In any event, I wouldn't tell alexreb that he has nothing to worry about--we don't know how broad the scope of his IDIQ contract is. When the Comp Demo program was in effect, alexreb didn't have to worry about a small business protesting a task or delivery under his contract on the basis that it was never considered for a small business set-aside. Such a protest would have been moot. Now that the Comp Demo program is no longer in effect, he has to worry about these types of protests. This is not a nonissue.

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I did not misunderstand you and you did contradict yourself. Your self-contradiction is obvious in your prior post. Moreover, you have significantly changed your position since your earlier posts and our telephone conversation last night.

This is what you said earlier in this thread:

The facts of the case are irrelevant to GAO's major premise, which is that the rule of two applies to all acquisitions, regardless of whether the agency plans to use an IDIQ contract or not. The use of FAR 16.5 to place an order does not insulate an agency from having to comply with the rule of two. To assume that the GAO would interpret the rule differently if given a different set of facts is unreasonable.

What you are saying now is that if the rule of two applies only if the agency had not conducted the appropriate 19.502-2(B) analysis before soliciting proposals for the contract--i.e., it applies to within scope task orders only if the agency did not comply with the rules when awarding the contract. (In order to be legally awarded the rule of two analysis must have been performed and the rule complied with at the time of solicitation of proposals for the contract.) In short, the legality of the award of the contract is a pertinent fact issue, and so facts are relevant, and the rule of two does not apply to all acquisitions, since it does not apply when the facts are that a task order (an acquisition) is (1) within scope and (2) under a legally awarded contract.

Facts in LBM were clearly relevant to the outcome. In LBM work that had been procured under a small business set aside was transferred to a task order contract that clearly did not contemplate inclusion of that work when proposals were solicited and the contract awarded. That is why the rule of two was applied. Anyone reading this thread can read that decision and see that for themselves.

(As for scope of competition v. scope of the contract, let me ask you: Can work be within the scope of a contract if it was not within the scope of the competition for that contract? Can work that is outside the scope of a contract have been within the scope of the competition for that contract?)

This is what I said to axelreb in my first post in this thread:

If an IDIQ contract was awarded in compliance with the laws and regulations then in effect, and if a new requirement is within the scope of that contract, then the requirement need not be competed except as required by FAR Subpart 16.5, which is about competition restricted to awardees of multiple award IDIQ contracts. See FAR 6.001(e) and (f). See also FAR 5.202(a)(6) and (11). If the work need not be competed, then it need not be set-aside under 19.5. There is no need to revisit the set-aside issue for work that is within the scope of a legally awarded contract.

I still say that. And if those conditions are met and I were axelreb's boss I would tell him/her to get the hell off Wifcon Forum and get on with issuing orders.

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Vern,

There is nothing contradictory in what I wrote and I have not changed my position since my first post. If you expect me to continue to defend myself against your accusations, then I'm sorry to disappoint you. My position was clearly stated in my last post. Anybody reading that post would understand my position. You are choosing to misunderstand me at this point--I have no patience for that. Too bad, it could have been a good discussion.

Regarding "scope of the competition" and "scope of the contract", there are situations where they do not overlap. See Administration of Government Contracts, Fourth Edition, p. 388

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Guest carl r culham

Admittedly I have provided no references to support my view. There are none as I suspect Vern would have laid them on us already. All referenced support to arguements do not address the instant issue and unless alex continues to use the IDIQ and a SB takes exception through protest there will not be a reference. Further I would note any reference would have to support that for an elective use procurement method such as a non-mandatory IDIQ that a CO can use that method even though it does not meet current statute and regulation regarding set asides.

Clarified further the IDIQ in alex's hand is legal, but to otherwise use it now to secure new A-E service requirement would not be proper for any procurement under $150K and and any over $150K where there are two or more SB's available to do the work. Furthered by example. I have an IDIQ that says I can use delivery orders to buy steel from Timbucktoo but a new statute is put in place to say steel in Timbucktoo is no longer to be used for government projects. I sure the heck would not use it to buy steel for a new project I would use other procurement types and methods available to me!

Also would note that partial support is offered that it is okay for alex to continue because the FAR (Council I suppose) says it is not a significant change then therefore must not be.

My conclusion is that alex has raised a very legit question that everyone did not consider, even the FAR!

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Don,

I don't misunderstand you. I understand you perfectly. I think you've been playing dodgeball. This was your original position:

The facts of the [LBM] case are irrelevant to GAO's major premise, which is that the rule of two applies to all acquisitions, regardless of whether the agency plans to use an IDIQ contract or not.

I took that to mean, as you know from our conversation last night, that if an agency wants to place an order against an IDIQ contract it must first determine whether two small businesses can do the work and, if they can, the agency cannot place the order but must conduct a separate competition set aside for small businesses. If that was not your intention, then I did misunderstand you. But I don't think I did. We spent at least a half hour debating that last night and we went over it several times.

Your current position, as I understand it, is that the facts of the LBM case are relevant and the rule of two does not apply to an acquisition in the form of a within scope order if the agency complied with that rule before issuing the solicitation for the IDIQ contract. If that is your current position, which is what I told axelreb a day or so ago, then you and I now agree and any further conversation would be a waste of time.

If you keep saying that the facts in LBM do not matter, and the rule of two applies to all acquisitions, and that COs must make a rule of two determination for each and every within scope task order contemplated under an IDIQ contract, then we disagree, and the readers of this thread can read that case and arrive at their own conclusions.

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Clarified further the IDIQ in alex's hand is legal, but to otherwise use it now to secure new A-E service requirement would not be proper for any procurement under $150K and and any over $150K where there are two or more SB's available to do the work. Furthered by example. I have an IDIQ that says I can use delivery orders to buy steel from Timbucktoo but a new statute is put in place to say steel in Timbucktoo is no longer to be used for government projects. I sure the heck would not use it to buy steel for a new project I would use other procurement types and methods available to me!

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My conclusion is that alex has raised a very legit question that everyone did not consider, even the FAR!

Carl: You make a good point about the prohibition against buying steel from Timbuktu. But I think that's different. I think that clearly applies to all acquisitions, within scope and out of scope: Don't buy anything from Timbuktu.

I think the rule of two, which is an acquisition planning rule, applies to future "new work" acquisitions, and I think the FAR council does, too, which is why they didn't say anything about it. But there is an easy way to find out. If you look at FAC 48, Item I, you'll find the name of the procurement analyst responsible for that change and his phone number. Call him for clarification.

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It is difficult to fault Carl's logic, and more difficult to understand why this thread has moved to discussions of distinctions without differences, in tangents so far removed from the intent of the demonstration program and the reasons for its repeal.

The first stated purpose of the demonstration program was to assess the ability of small businesses to compete successfully for designated kinds of work without set-asides. (Tangent: At least in the case of this IDIQ, they could not.) Other purposes included enhanced set-asides in targeted categories of work as detemined by agencies, and measuring the extent of awards to emerging small businesses while establishing a new kind of set-aside for these businesses. (FAR 19.003)

The demonstration program was repealed by a law that expressed the will of the Congress, and expressed it fairly clearly, in order to give small businesses a better shot at competing for awards of new work. This from the Senate Finance Committee: "Removes the red tape and closes loopholes that too often put government work into the hands of multinational corporations instead of Main Street businesses." Here is what the SBA had to say: "The law eliminates the ?Competitiveness Demonstration? program, which limited opportunities for small contractors in 11 industries where they excel, such as construction, landscaping and pest control."

The effective date was set and reached, so the repeal is now in effect.

What is the effect of the repeal? It would not make sense to terminate ongoing delivery or task order work, but it seems clear that for any new work, the demonstration program is officially over.

The authority to award new work under a contract vehicle created under the repealed demonstration program would seem to be directly contrary to the expressed will of Congress. (No more steel from Timbucktoo.)

To do otherwise would not pass the red-face test. Imagine being called to testify in front of a congressional committee and being asked to explain why you awarded new work under a repealed program. All the finely nuanced arguments in the world would not sound reasonable, mainly because they aren't, imho.

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By your logic, every new law upturns contracts awarded prior to the enactment of the law.

  • When the Truth in Negotiations Act was passed in 1962, no one said we could not continue to issue orders against IDIQ contracts awarded prior to its enactment and without having obtained cost or pricing data or that we couldn't exercise options to extend such contracts.
  • When the Competition in Contracting Act was enacted in 1984, no one said we could no longer issue orders against IDIQ contracts awarded without full and open competition prior to the enactment of the law. No one said that we could not exercise options to extend such contracts.
  • When the Federal Acquisition Streamlining Act was enacted in 1994, no one said that we could not continue to order items that were commercial under IDIQ contracts awarded without commercial terms and conditions prior to FASA's enactment, or exercise options to buy more or extend such contracts. And no one said we could not place orders against contracts for which past performance had not been an evaluation factor.
  • When Clinger-Cohen was enacted, no one said we could no longer issue orders against IT contracts awarded prior to its enactment.

I could go on and on. The Competitiveness program prohibited set-asides in certain industries. It was effective until repealed. Why would its repeal affect contracts awarded earlier pursuant to its terms? Why are you arguing that the repeal is retroactive and invalidates legally awarded contracts that predate it? Did the repeal statute make it retroactive? The new FAR regulations do not make it retroactive. Where do you get that "expressed will of Congress" business as applied to previously awarded contracts? Where did Congress say we can no longer use such contracts? Did you find that in a House or Senate report? In a committee hearing? The Congressional Register? Where?

Some of you guys pull stuff out of empty air and would use whatever it is to topple the entire procurement process. It's frightening. I would have no trouble explaining to Congress my continuing to issue orders against contracts awarded prior to the repeal. If they gave me a hard time I would tell them that if that had wanted to invalidate validly awarded contracts they should have said so.

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