SaulGoodman

Thank you both, I am indeed asking about existing contracts. The divisions could compete against one another but I don't think that has been done. The divisions work cooperattively through intra-company agreements. My biggest worry is that the GSA OIG will make us change our BOA.

I posted this in the contract administration forum but had no response so I am trying here- I haven't seen this exact question before so here goes....I would for a contractor with GSA schedules and other government contracts. We are a wholly owned subsidiary of Parent, and Parent is owned by a holding company. Immediate parent has two divisions - we'll call them finance and nonsense. There is an effort to combine sales, marketing and delivery efforts of the finance division with my subsidiary because we do similar work, but there is no plan to legally change the structure. We will remain a wholly owned sub. Finance will remain a division - not a subsidiary - of our immediate parent. My questions are as follows: If we market and sell together under a "doing business as" name with no legal change to our corporate structure, do we run the risk of violating the price reduction clause of the false claims act? Suppose we have delivery people who go back and forth between the wholly owned sub and the division, but bill at different rates on different projects. Can a person in the division bill a division client at a rate less than the GSA rate? Does it depend on what their skillset, education and other labor category qualifications are? How similar does the work have to be to trigger the PRC? How similar does the division client need to be to sub's basis of award to trigger the PRC? In short ...can this allow the government to "pierce the corporate veil" and start looking at the books of the parent company when they are trying to determine a BOA or find a PRC violation? I read this on another thread relating to a similar situation: >>This is where GSA and the DOJ have a field day with the False Claims Act. If you withhold disclosure of a customer or group of customers that would have revealed a different BOA, then you can open yourself up to a FCA violation. Also, if you sell to a non-BOA and the price is lower than to your BOA and you did not disclose that information, you could be considered in violation of the FCA because the logic used is that if you had disclosed this other customer or category of customers, they would have been the BOA and not the one declared. << Is this something we need to worry about in the situation I described?

Is there any way to find out whether a GSA contract holder used a commercial basis of award customer versus a cost build up method in determining their GSA schedule pricing? Pricelists don't say how the rates were established, at least not that I can see.

Thank you all for weighing in. In the last question, what I meant was this: if bidders knew that the option was going to be evaluated as well, might they have submitted pricing? For example, if you reasonbly expected to get another 6 months out the deal, you might lower price a tiny bit.

I'm looking for your input on an evaluation question. I read the thread linked below. Here is the scenario: Contractors bid on an RFP with 4 option years after the base period. So we know that FAR Clause 52.217-8, Option to Extend Services, allows the government to extend for six months if they evaluated that option when they evaluated the proposals, but nowhere in the RFP did the government ever say that would evaluate and include the option when it came to pricing. The government took all of the pricing proposals, divded the final option year price by 2, then added that amount to what each contractor bid. Is that kosher? If the government planned to do that, shouldn't that have been made clear in the RFP and the evaluation criteria? Thoughts? how can the government evaluate the 6 month option price if all they have is hourly rates, but no determination of hours worked? Shouldn't the bidders have had the opportunity to adjust their pricing if they knew they might get another six months worth of billables? http://www.wifcon.com/discussion/index.php?/topic/609-option-to-extend-services/