govt2310

In early April 2026, the folks working on the RFO posted on FAI.gov in the FAR Forward Alliance Community section that the RFO still allows you to do a competitive range of one. They believe the current language/phrasing in the RFO is sufficient to communicate that, but because they received inquiries on this issue, they have taken out the word "group" in their proposed rule.

C Culham, that is a good point. Also, FAR 49.303-5 at paragraph (d) says: (d) If an overall settlement of costs is agreed upon, agreement on each element of cost is not necessary. If appropriate, differences may be compromised and doubtful questions settled by agreement. An overall settlement shall not include costs that are clearly not allowable under the terms of the contract.

Another good point by Joel. Well, let's say the T4C happened during contract performance. This is making me think that, probably the only Start Up Costs that a contractor could get are costs that happened AFTER the contractor won the contract award, but before the contractor had to begin contract performance. Thoughts?

Thank you, Joel, yes, I see your point. It does seem likely that a contractor would have to categorize these costs as overhead, as they don't know for sure if they will win the contract award or not.

According to the Ben Holtz CBCA decision in November 2023, yes, Start-Up Costs can be costs that "result from the termination." Here is an article about the Ben Holtz CBCA decision, https://www.millerchevalier.com/publication/cbca-adopts-common-sense-interpretation-far-52212-4l-contractors-should-not-put-all. Here is the Ben Holtz CBCA decision posted on the CBCA.gov website, https://www.cbca.gov/files/decisions/2023/KANG_11-17-23_7637__BEN_HOLTZ_CONSULTING_INC_DBA_CALIFORNIA_AVOCADOS_DIRECT%20(DECISION).pdf. In the Ben Holtz CBCA decision, the CBCA said that "costs resulting from the termination" can include "such things as start-up costs; unrecovered running expense." The CBCA said that "costs resulting from the termination" can include "preparatory or startup activities that are not separately priced under the contract." The CBCA cited as persuasive some decisions by ASBCA and COFC. In particular, the CBCA cited the Value Recovery Holding, LLC COFC decision, where COFC said that FAR 52.212-4(l), under the "costs resulting from the termination" phrase, covers costs incurred "prior to performance" to satisfy "necessary" contract requirements, e.g., obtaining required licenses and permits, etc. If a contractor has to get licenses and permits in the Start-Up Phase, how is that different than the contractor's duty to get employees in place to work on the contract? And if the hiring and interviewing work is considered part of Overhead, how can the Contracting Officer discern for sure whether this task was covered or not covered by Overhead, other than by taking the Contractor's pinky swear promise that wasn't?

For a Termination for Convenience Settlement Proposal, can the Contractor get compensated for Start-Up Costs? Let's say this is a FAR Part 12 commercial services contract. The Contract contains FAR 52.212-4. FAR Part 12 says that FAR Part 49 does not apply, but it can be taken as guidance. FAR Part 49 says to look to FAR Part 31 to figure out allowability of costs. FAR 31.205-32 says Pre-Contract Costs are allowable, but only when they are necessary to comply with the proposed contract delivery schedule (Precontract costs means costs incurred before the effective date of the contract directly pursuant to the negotiation and in anticipation of the contract award when such incurrence is necessary to comply with the proposed contract delivery schedule. These costs are allowable to the extent that they would have been allowable if incurred after the date of the contract). FAR 31.205-42 says Termination Costs includes Initial Costs, which includes Preparatory Costs for things like "management and personnel organization." However, if these are direct charges in the Settlement Proposal, "such costs shall not also be included in overhead." FAR 31.205-34 Recruitment Costs says that the costs of help-wanted advertising, costs of maintaining the HR office, travel costs for recruiting, etc, are allowable. FAR 31.205-13 Employee Morale Costs says that costs incurred on activities "designed to improve working conditions, employer-employee relations, employee morale" are allowable. Let's say the Contractor wants to get compensated for the following: interviewing and hiring employees during the Bid Proposal Preparation Stage to work on the Contract if they win the Contract Award. Are these costs allowable?

This is wonderful news! Thank you, Vern!

Thank you, Vern! I'm so happy that Wifcon will continue!

My condolences to Bob's family. Thank you to Bob for starting Wifcon.com and sharing so much government contracting wisdom and knowledge. I have learned so much from this site.

Thank you to everyone who responded to my original post. This is helpful.

Hypothetical: An agency establishes a BPA with 10 BPA Holders for software development services. Agency issues a Call Order to BPA Holder #1, where that Call Order is characterized as "an IDIQ." Agency issues a Task Order #1 off of the Call Order for BPA Holder #1 to develop software #1. Then Agency issues Task Order #2 off of the Call Order for BPA Holder #1 to develop software #2. BPA Holders #2 to #10 file a protest asserting that the Agency has violated competition rules. Thoughts on how this would play out?

I think the answer is no. But I can't find any authority that directly addresses this question. Does anyone know?

The DHS HSAM used to have a Debriefing Guide at Appendix AA. DHS revised the HSAM in 2023, and now it is gone. But it is still mentioned within the HSAM. Does anyone have the link to the current DHS Debriefing Guide? Link to HSAM https://www.dhs.gov/homeland-security-acquisition-manual

Thanks, Vern! Link to EPAAR 1532.003 EPAAR 1532.003 Simplified acquisition procedures financing. (a) Scope. This subpart provides for authorization of advance and interim payments on commercial item orders not exceeding the simplified acquisition threshold. Advance payments are payments that are made prior to performance. Interim payments are payments that are made during the order period according to a payment schedule. (b) Procedures for micropurchases. Contracting officers may authorize advance and interim payments on orders for commercial items only at or below the micropurchase threshold. (c) Procedures for purchases exceeding micropurchase threshold. Contracting officers must secure approval at one level above the contracting officer, on a case-by-case basis, for advance and interim payments on orders for commercial items exceeding the micropurchase threshold and not exceeding the simplified acquisition threshold. The contracting officer shall submit a recommendation for approval of financing terms, along with the supporting rationale for the action, to one level above the contracting officer. Remote simplified acquisition contracting officers (SACO) without one level above contracting officers at their locations shall forward recommendations through their OAM Advisors to secure one level above approval. (d) Supporting rationale. Regardless of dollar value, the contracting officer shall document the file with supporting rationale demonstrating that the purchase meets the conditions of FAR 32.202-1(b)(1), (3) and (4). (e) Administration. Regardless of dollar value, the contracting officer is responsible for ensuring that supplies or services have been delivered. The contracting officer shall document the file with evidence of receipt of supplies or services throughout the order period as appropriate to the acquisition. (f) Clause. The contracting officer shall insert the clause at 1552.232-74, Payments - Simplified Acquisition Procedures Financing, in solicitations and orders that will provide simplified acquisition procedures financing.

Thanks, C Culham! Well, I looked at your two links. The VA policy mentions, as examples, prosthetics, subscriptions, and training. Advance Payment for subscriptions and training is authorized by their own statutes, and they are not limited to Micro-Purchases. I don't know if there is a statute that authorizes advance payment for prosthetics. The Army AFARS also talks about subscriptions and training. What I'm interested in is an example of where an agency promulgated regulations/policy saying it is ok to do advance payment for a Micro-Purchase regardless of what product/service is being purchased. For example, something that allows a Cardholder to pay in advance for a Hotel Agreement (conference space).