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Moderator

Root Admin

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  1. I had planned to write a detailed article about my plan for the above committees. However, I'm never going to get to it. So, I'm going to try a series of quick posts to get my thoughts published. Don't tell me that these committees will never be formed. I know they won't. Committees and subcommittees are entities run by politicians for politicians. However, I can dream.
    You can see from the titles of my proposed committees that they would deal with federal contracting and federal assistance. For now, this blog entry will deal with federal contracting only. In fact, this blog entry will deal only with the structure of the committees. Both the House and Senate committees will have the same jurisdiction and subcommittees. Here we go!

    I view the first 4 subcommittees as oversight committees that would work with the last 2 subcommittees. However, I see much work for the final 2 subcommittees beginning with Day 1.
    More later.
  2. Imagine quoting on a procurement in which you submitted the lowest-priced, technically acceptable quote. Instead of winning the award, you were told that your quote was unacceptable and ineligible for award because you did not possess the requisite facility clearance prior to award. Although you submitted your facility clearance information to the contracting officer on December 6, 2012, nearly two months later on February 1, 2013, little had been done on it.
    You protest to the U. S. Court of Federal Claims and everything seems to be going your way until you read the following quote from the opinion:
    Nonsense! Even the dictionary cannot tell me what propinquent means. However, the dictionary does define propinquity. My interpretation of the phrase that I italicized is "good enough for government work." That's not good enough for me. I disagree with the judge's ruling! In addition, I disagree with the judge's singling out one individual for a process issue.
    Now, let's look at the cause for the nearly 2-month delay in processing the facility clearance. I blocked out the individual's name because I want you to look at this as a process issue.

    I'm asking you to look at the above quote and the entire opinion to identify ways to improve the process in this procurement. I'm not looking for an answer here. Instead, how would you initiate the improvements? I'll point out a few items to give you a start.
    He was on personal leave for sixteen days during that time period.
    He halted the processing of DD Form 254 requests for a two-week period in January while the Defense Security Service was questioning whether a bona fide need existed for any facility clearances under SINs 132-54 and 132-55 under Schedule 70.
    The splitting of responsibilities in the Memorandum of Agreement between the Defense Information Systems Agency and the General Services Administration.

  3. GAO supplies us with its contracting rules in bid protest decisions. These rules are repeated and this is one of the reasons I provide key excerpts from bid protest decisions on Wifcon.com's Bid Protest pages. If you read these rules repeatedly, you will remember them. For example, here is a rule on what GAO reviews on a past performance issue.

    Think "consistent with the solicitation’s stated evaluation criteria" for this blog entry.
    Recently, GAO's decision in American Apparel, Inc., B-407399.2, Apr 30, 2013, drew my attention. We know a solicitation's terms are important because it is what bidders and offerors rely on to prepare their bids and offers. However, could GAO's own rule that states "consistent with the solicitation’s stated evaluation criteria" leave it with an oddly written decision. I believe that it did.
    In the American procurement, the solicitation stated that

    All of you probably have seen something similar to the above in a solicitation. It is not the solicitation language in this procurement; it is the events that interest me. The solicitation closed on September 22, 2010 but the contract wasn't awarded until January 18, 2013, over 2 years later. Things can happen in 2 years and in this procurement things did happen. American claimed that during this 2-year period, the successful offeror--Bluewater Defense--had performance deficiencies. However, in response to the protestor's claim GAO said

    My problem with using FR Countermeasures, Inc., in its decision as an example is that, in FR Countermeasures, there was a short period of time between the solicitation closing date and contract award. In the American decision, this time period was over 2 years. However, GAO happily states its rule without dealing with this 2-year period. That bugs me. Case closed, decision over, the protester loses. Maybe this caused some scratching of heads in GAO's bid protest unit too. I don't know but it left me wondering.
    A skilled writer can use sleight-of-pen to make it appear that it dealt with an issue without really dealing with it. In my opinion, that is what GAO did and dealt with the 2-year time period in its background section. GAO mentions that the source selection authority (SSA) made its selection decision on January 13 without adding which year. (The decision also includes 2 different solicitation closing dates so I assume that the missing year was an oversight.) However, the sequence of events leads me to assume that the date was January 13, 2011. GAO further explains, that the procurement record (probably the contract file) included a memorandum from the contracting officer dated November 1, 2012, about a briefing given to the SSA on the results of a "supplementary past performance review." The memorandum explains that this review was written due to the length of time that had passed between the solicitation closing date and the award decision. GAO included a blurb from that memorandum which explained

    Remember GAO did not discuss this memorandum in its "ruling" section of its decision. To complete its story, GAO wrote in the background section that

    In the end, GAO issued its decision using its rule on the solicitation's requirements, ignored the 2-year period in its ruling, but deals with the 2-year period in the background section. Would GAO have mentioned it in the ruling section, if during the 2-year period, there was a substantial decline in the winning offeror's past performance? Anyway, it had me wondering.
    There are 2 decisions you might want to read. They are FR Countermeasures, B-295375, February 10, 2005, mentioned in the decision, and International Business Systems, Inc., B-27554, March 3, 1997 for the "too close at hand" passage mentioned by the protester.
  4. In Lockheed Propulsion Company; Thiokol Corporation, B-173677, June 24, 1974, GAO issued its bid protest decision on the Solid Rocket Motor (SRM) Project for the Space Shuttle Program. This decision was issued before the National Aeronautics and Space Administration (NASA) had its first SRM and before it had its first Space Shuttle.
    One part of the Lockheed protest dealt with the proposed costs for ammonium perchlorate (AP), a major part of the propellant in the SRM. Two offerors, Lockheed and Thiokol, had proposed different costs for the AP even though they would be getting the AP from the same suppliers. GAO concluded that the offerors' evaluated costs should be the same for the AP because of this. As a result, GAO proposed a $68 million dollar adjustment to the evaluated costs of Lockheed and Thiokol. Since NASA had concluded that Lockheed and Thiokol were technically equal and that their evaluated costs were both in the $800 million range, a proposed adjustment of this size could affect the outcome of the selection.
    GAO recommended that
    NASA promptly considered GAO's recommendation and continued with its original selection of Thiokol for the SRM award.
    Nearly 39 years later, I was reminded of this decision by GAO's decision in BC Peabody Construction Services, Inc., B-408023, May 10, 2013. In this procurement, the Corps of Engineers rated the same subcontractor as acceptable for Edens Construction Company but unacceptable for BC Peabody Construction Services.
    GAO explained
    Although GAO concluded that the two offerors had been treated unequally by the Corps, GAO further explained that it
    Unlike in the Lockheed decision, GAO decided that BC Peabody did not have a chance to win because it still would have received a "deficiency" for not having a letter of commitment from a subcontractor.
    The moral of this story is that even after proving that a mistake was made, if the protester cannot win anyway, it still loses.

  5. Look What GSA Forgot

    · Moderator · 05/17/2013 10:57 AM

    The General Services Administration (GSA) has about 19,000 Multiple Award Schedule (MAS) contracts. About 80 percent are contracts with small businesses. Last year, GSA proposed terminating thousands of small business contracts for not meeting the $25,000 annual sales threshold. Apparently, GSA forgot to pay the contractors something--$2,500.
    The House Committee on Small Business did some checking--more likely someone told them--and found that GSA owed some money. Here is the story.
    You can read all about it at the Small Business Committee site.
  6. I was reading a decision of the Armed Services Board of Contract Appeals (ASBCA) about a week ago and I found the following.
    Why read the ASBCA decision when I could go straight to the horse's mouth! So I searched the Court of Appeals for the Federal Circuit (CAFC) web site and I found the Sharp decision--and it was recent. Here is a brief description of the issue in the Sharp case.
    On September 18, 2001, the General Services Administration (GSA) awarded a multiple award schedule (MAS) contract to Sharp Electronics Corporation for office equipment. On December 1, 2005, the Army issued a delivery order "in accordance with and subject to terms and conditions" of Sharp's MAS contract. The order provided for a four-year lease of copier equipment, including one base year and three option years, with the last option year ending on December 1, 2009. Option years one and two were exercised in full. The Army partially exercised option year three for six months and subsequently extended the lease for three more months. The lease finally ended on August 31, 2009.
    Sharp filed a claim with the Army contracting officer (CO) citing the termination fee provisions of its schedule contract. The Army CO did not respond and did not refer Sharp's claim to GSA's CO who was responsible for Sharp's MAS contract. After 60 days, Sharp appealed to the ASBCA which determined that it did not have jurisdiction and dismissed the case. Sharp then filed an appeal with the CAFC.
    What should an agency CO do with a dispute on an order? What should an agency CO do if there is a question of contract interpretation with the MAS contract and that interpretation affects the interpretation of the agency order? Well, in a majority decision, the CAFC tells us this.
    It is easy for the CAFC but is it that easy for you? There was a minority opinion in this CAFC case too which looked at it differently.
    Anyway, the CAFC case is Sharp Electronics Corporation v. John McHugh, Secretary of the Army, No. 2012-1299, February 22, 2013. The ASBCA decision is Impact Associates Inc.
  7. We've all seen this before. The government and contractor sign a contract with a base period and several 1-year options. Sometimes, the 1-year option periods even mirror the government's fiscal year. A nice little puppy. Then, the harsh realities of government take over and our little puppy grows into an unwieldy mongrel. Such is life in federal contracting and here is a story about one such dog.
    On February 27, 2009, the Army National Guard and Glasgow Investigative Solutions, Inc. (GIS) signed a contract for armed security guard services at the National Guard Armory, Washington, DC. The contract included a 3-month base period from March 1, 2009 to May 31, 2009 (CLIN 0001) and 4 option years (CLINs 2 through 5) beginning October 1, and ending September 30 of 2010, 2011, 2012, and 2013. There is another option to extend the base period for 4 months from June 1, 2009 to September 30, 2009 (CLIN 0006). Of course, the contract included the clause at FAR 52.232-18, Availability of Funds (Apr 1984).
    Mod 1, a bilateral agreement, exercised the option in CLIN 0006 for the 4 months to the base period from June 1, 2009 to September 30, 2009 and added the clauses in FAR 52.217-6 Option for Increased Quantity and 52.217-8 Option to Extend Services.
    Mod 2, a bilateral agreement, fully funded the contract through September 30, 2009.
    Mod 3, a bilateral agreement, modified the contract by extending CLIN 0006 from October 1, 2009 through January 31, 2010 and fully funded this 4-month extension. The 4, 1-year option periods in CLINs 0002, 0003, 0004, and 0005 were reset to begin February 1 and end January 31 of the following years.
    Mod 4, a bilateral agreement, exercised the first 1-year option period in CLIN 0002 from February 1, 2010 through January 31, 2011.
    Mod 7, a bilateral agreement, extended the first option period in CLIN 0002 for 2 months, from February 1, 2011 through March 31, 2011.
    Mod 8, a unilateral agreement, and Mods 9 and 10, bilateral agreements, extended the first option period in CLIN 0002 from April 1, 2011 through June 30, 2011.
    By now, the contractor was irritated with the extensions to the first option period. After all, the parties signed an original contract that contained 1-year options--not 1- or 2-month extensions to the first option period. The contractor notified the contracting officer about its concerns. On June 28, 2011, the contracting officer noted the contractor's concerns but explained that "due to limited funding, the government is unable to exercise a one (1) year option to the contract at this time." Instead, the contracting officer said she was prepared to extend the contract for an additional 30 days through July 31, 2011. The contractor agreed to the 30-day extension but maintained its position that the modification is contrary to the original contract.
    On November, 17, 2011, the contractor filed a claim due to fundamental changes in the original option periods. The contractor had signed up for 1-year options not 1- or 2-month extensions. The contractor filed a notice of appeal to the Armed Services Board of Contract Appeals on April 27, 2012 and about 1 year later the Board rendered its decision.
    So what did the Board say? Find out on the bottom of page nine at Glasgow Investigative Solutions, Inc.
  8. On April 26, 2007, the Army awarded an indefinite delivery, indefinite quantity, fixed price, job-order contract to Lakeshore Engineering Services, Inc., for repair, maintenance, and construction services at Fort Rucker, Alabama. Lakeshore performed 79 construction delivery orders in the base year and 74 construction delivery orders in the first option year.
    On March 10, 2009, Lakeshore filed a claim with the contracting officer seeking $1,996,152.40 for losses it incurred while performing during the base and first option year. Lakeshore claimed that it had lost money as a result of the Army's pricing scheme. The contracting officer issued a final decision denying the claim and Lakeshore took the matter to the Court of Federal Claims.
    The pricing scheme was a bit complex. Offerors were told that offers were to be priced using three coefficients – one for work (1) during normal hours on pre-priced items, (2) during overtime work on pre-priced items, and (3) on non-pre-priced items. For the pre-priced items, the coefficient was to be "multiplied by the unit prices listed in a Universal Unit Price Book (UUPB) to price a job or project on individual job orders. According to the Solicitation, the coefficient was "a numerical factor that represents costs (generally indirect costs) not considered to be included in the [uUPB] prices, e.g., general and administrative and other overhead costs, insurance costs, bonding and alternative payment protection costs, protective clothing, equipment rental, and contractor’s profit." The Solicitation said the coefficient should account for a wide variety of risks of doing business, adding at a later point, the coefficient "shall contain all allowable contractor costs, including contingencies and profit." It further stated that the "offeror’s coefficient shall contain all costs other than the pre-priced unit prices, as no allowance will be made after award." The Solicitation, however, allowed for adjustments in the coefficient for the option years, to be based on the Engineering News Record building Cost Index (BCI), in accordance with the Economic Price Adjustment Clause, Army Federal Acquisition Regulation Supplement 5152.237-9000.
    The Solicitation designated the Gordian Group Construction Task Catalog (the Gordian Catalog) and PROGEN Online as the UUPB and accompanying software, respectively, to be "used by the contractor in development of price proposals for individual Task Orders." According to the Solicitation’s technical specification, "[t]he UUPB, modified for Fort Rucker, contains pricing information (i.e., Government Estimate) for the description of work to be accomplished and for the units of measure specified." This segment further indicated that the "UUPB consists of Divisions 1 through 16 that are applicable to Divisions 1 through 16 of the Job Order Contract Technical Specifications." It additionally specified that the "UUPB modified for Fort Rucker contains unit pricing data to be used by the Contractor in development of price proposals for each work order," adding that "[t]he pricing data is presented as basic items and as price adjustment modifiers to the basic item."
    The pricing information available to offerors also included the caveat that: "[w]hile diligent effort is made to provide accurate and reliable up-to-date pricing, it is the responsibility of the Contractor to verify the unit prices and to modify their Adjustment Factors accordingly."
    What happened at the Court of Federal Claims? See Lakeshore Engineering Services, Inc. v. U. S., No. 09-865C, April 3, 2013.
  9. In the U. S. District Court for the District of Columbia, a recent opinion was issued in which 3 hospitals wanted to avoid being labled as government subcontractors to avoid the Department of Labor's rules covering subcontractors.
    The hospitals had contracts with UPMC Health Plan to provide medical services and supplies to individuals enrolled in its program. UPMC contracted with the U. S. Office of Personnel Management (OPM) to provide coverage for federal employees in the Federal Employees Health Benefits Program. Since the hospitals provided medical services to federal employees pursuant to their agreements with UPMC, the Department of Labor concluded that the hospitals qualified as subcontractors and were subject to certain statutory and regulatory requirements imposed on subcontractors.
    Part of the judge's opinion stated that the "Provision of medical services and supplies was a critical component of the UPMC's contract. The contract depended on medical providers like the [hospitals] to offer medical services and supplies necessary for UPMC to meet its obligations under its contract with OPM." "Therefore, they qualify as subcontractors under the Secretary's regulations."
    You can see the full opinion here.
  10. " . . . was on the take. At the New Mexico Department of Corrections she was responsible for selecting the best contractors to perform maintenance work for the State. Instead and bypassing any public bidding process, she awarded about $4 million in contracts to . . . over the course of three years -- receiving about $237,000 in return from . . . , [the contractor's] owner."
    See the judgment at ca10.uscourts.gov (pdf).
  12. The Army plans to develop and procure a new Ground Combat Vehicle (GCV) that will do two things: 1) operate as a combat vehicle and 2) transport soldiers onto the battlefield. The GCV would replace the current Bradley Infantry Fighting Vehicles. The Congressional Budget Office (CBO) believes that implementing the GCV program would cost $29 billion–in 2013 dollars–between 2014 to 2030.
    The CBO did a report that compares the Army’s plan for the GCV with four other alternatives. Although none of those alternatives would meet all of the Army’s goals for the GCV program, the CBO claims that all are likely to be less costly and less risky than the Army’s plan. Two of the alternatives would involve procuring the vehicles from other countries.
    See it at cbo.gov.

  13. Two Days To Remember

    · Moderator · 04/05/2013 11:48 AM

    The government has plenty of rules involving time. In certain circumstances, an offeror has 10 days to submit a protest. On the other end of the process, contractors have so much time to submit a claim or to respond to a contracting officer's final decision. Here is one case involving time limits:


    On April 26, 2012, EPSI submitted a certified claim to the SBA contracting officer seeking $135,013.27 from the SBA for increases in the minimum wages during EPSI's period of performance from October 1, 2007, through April 19, 2009. The contracting officer issued a final decision denying the claim on July 5, 2012. There is no dispute in the record that EPSI received the final decision on July 5, 2012. EPSI filed its notice of appeal by fax with the Board on October 5, 2012 (a Friday), which is ninety-two days after receipt of the final decision. On October 19, 2012, the respondent filed a motion to dismiss, arguing the notice of appeal was untimely. In response to a show cause order, EPSI responded to the motion, arguing that the notice of appeal should be considered timely in light of the extent of the activity and delays by SBA for three (3) years after performance of the contract and the existence of reasonable excuses for the one (1) day delay. See what the Civilian Board of Contract Appeals had to say about this.
  14. "According to the complaint, filed in this matter with the United States District Court, Southern District of California, case number 13MJ1269, Cervantes is charged specifically with violating Title 18, United States Code (U.S.C.) Section 201 ( B )(2), bribery. Cervantes allegedly used his position to extort bribes from businesses seeking to do business at Camp Pendleton and allegedly referred to himself as the Godfather at Camp Pendleton; Cervantes is currently a U.S. Department of Defense employee and a supervisor for Construction and Service Contracts, Inspection Branch, at Camp Pendleton."
    See it at fbi.gov.

  15. Contractors Up For Suspension

    · Moderator · 04/01/2013 03:54 AM

    "A bipartisan group of senators led by U.S. Senator Jeanne Shaheen (D-NH) are expressing continued concern and frustration over the Army's use of contractors that have potential ties to terrorist groups. The senators specifically referred to a longstanding backlog of 43 referrals pending before the Army's Suspension and Debarment Official that involve individuals or companies with links to groups including the Haqqani Network and Al Qaeda as reason for concern that underscores the Army's need to take swift action."
    See it at shaheen.senate.gov

  16. Is That The Milky Way Galaxy?

    · Moderator · 03/22/2013 01:18 PM

    "What you’re looking at is a cell in the midst of dividing into two identical copies—a process called mitosis. Here, the chromosomes (in blue) are aligned at the cell’s equator. Microtubules (red) from opposite poles of the cell attach to the chromosomes using the kinetochores (green) and pull them to opposite ends of the cell, which then splits in half. But sometimes cells do not divide properly—a common problem in cancer. Understanding the mechanics of cell division could help us correct this process when it goes wrong."
    See it at directorsblog.nih.gov.

  17. Frankenstein's Monster

    · Moderator · 03/18/2013 12:23 PM

    You are a program officer with big "wants" but with little federal money. Your contracting officer is not familiar with hiding overruns in an FPI(F) contract--yet. Besides, you have never heard of it--yet. What to do? Well, this politician knows best. With a little luck and plenty of ignorance, you may see the "fixed price technical competition, under which all offerors compete solely on nonprice factors and the fixed award price is pre-announced in the solicitation."
    Let's think about this. Fixed price, fixed award price, the same thing. Nobody is saying anything against the FPI(F). So, get ready, low ball your fixed-price and let the offerors compete for it. If they want the business, they can promise you anything. What else can they do? In a few years, just before things fall apart, find another job.
    By the way, if you want to read about it start at the bottom of the "Discussion draft" to the right of the article. It is in Title V "Other Reforms." They should have called it "Afterthoughts."
    See it at fcw.com

  18. Another One Bites The Dust

    · Moderator · 02/26/2013 11:25 PM

    ". . . in the current fiscal climate, agencies and businesses alike have been forced to make tough spending cuts. After carefully reviewing the projected spending and attendance for this year’s conference, GSA is suspending Expo for 2013 in an effort to use our resources responsibly and to deliver better value and savings for our government partners, our vendors, and the American people."
    See it at gsa.gov.
  19. "Under a Contractor Team Arrangement (CTA), two or more GSA Schedule contractors work together to meet ordering activity needs. By complementing each other's capabilities, the team offers a total solution to the ordering activity's requirement, providing a "win-win" situation for all parties."
    But what is a Prime/Subcontractor relationship and what is the difference from a CTA? Let GSA explain.
    See the information at gsa.gov.
  20. One of our colleagues sent this to me and I am posting it for you. Even Bilbo Baggins has a contract attorney to watch over him.

    "I, the undersigned, [referred to hereinafter as Burglar,] agree to travel to the Lonely Mountain, path to be determined by Thorin Oakenshield, who has a right to alter the course of the journey at his so choosing, without prior notification and/or liability for accident or injury incurred."
    "The aforementioned journey and subsequent extraction from the Lonely Mountain of any and all goods, valuables and chattels [which activities are described collectively herein as the Adventure] shall proceed in a timely manner and with all due care and consideration as seen fit by said Thorin Oakenshield and companions, numbering thirteen more or less, to wit, the Company." See the article at wired.com.
  21. In Estes Express Lines, Inc. v. U. S., No. 11-597C, January 15, 2013, the Court of Federal Claims said:


    "For the government to be sued on a contract pursuant to the Tucker Act, there must be privity of contract between the plaintiff and the United States." "This is so because the doctrine of sovereign immunity precludes a suit against the United States without its consent and because, under the Tucker Act, the United States has 'consent[ed] to be sued only by those with whom it has privity of contract."' Accordingly, "[t]he effect of finding privity of contract between a party and the United States is to find a waiver of sovereign immunity."
    Conversely, a finding of lack of privity deprives this court of jurisdiction. See the opinion here.
  22. At this time of year, newly introduced legislation often is introduced and then quickly enters oblivion. I checked this Senator's committee and subcommitee assignments and did not find any direct link to federal contracting. Maybe that explains it.
    "Sen. Toomey's bill would require the GAO to include the most common reasons bid protests are sustained. This additional information could help federal agencies identify needed improvements in the contracting process, reduce the number of protests overall and provide Congress with much-needed information about possible weaknesses in the federal contracting process to facilitate potential legislation."
    See it at toomey.senate.gov.
  23. In a letter to the Secretary of the Army and the Chief of Staff of the Army, Senator McCaskill, Chairman of the Senate Subcommittee on Contracting Oversight and Senators Shaheen, Coburn, Burr, Webb, Cornyn, Inhofe, and Blumenthal, questioned the significant delays between when a referral is made to the Army and when the Army takes action to keep the contractor from receiving additional government contracts. The Special Inspector General for Afghanistan Reconstruction reports that between June 2011 and June 2012, the Army's average time to process a debarment referral was a total of 323 days.
    See the letter at mccaskill.senate.gov.
  24. It's not a religious thing; it's a contracting thing — G. L. Christian style. We've all heard of the "Christian Doctrine." Here is how one judge of the Court of Federal Claims applied it to Bay County, Florida v. U. S., No. 11-157C, August 14, 2013 — released today. You can read the entire 11-page opinion or you can read the excerpt below.
    "The government argues that Bay County waived its potential status as an independent regulatory body by including FAR § 54.241-8 in the Sewage Contract — ignoring the limitation of Subsection (a) on application, viz., “[t]his clause applies to the extent that services furnished hereunder are not subject to regulation by a regulatory body.” FAR § 52.241-8(a); see Hr’g Tr. 11:11 to 12:1. Pointing to the principle that this court must avoid contract interpretations that render the FAR or contract terms superfluous, the government contends that the only way to give meaning to the Sewage Contract is to treat Bay County as a non-independent regulatory body. Hr’g Tr. 11:13 to 15:3. In making this argument, the government implicitly urges that a contractual provision that is inapplicable by its own terms must take precedence over the FAR’s requirements. The court cannot accede to such a proposition.
    When a contract subject to the FAR incorporates improper terms of the FAR, the correct provisions of the FAR control. See S.J. Amoroso Const. Co. v. United States, 12 F.3d 1072, 1075 (Fed. Cir. 1993); G.L. Christian & Assocs. v. United States, 312 F.2d 418, 426 (Ct. Cl.1963), mot. for rehearing and reargument denied, 320 F.2d 345 (Ct. Cl. 1963). “Under the so called Christian doctrine, a mandatory contract clause that expresses a significant or deeply ingrained strand of procurement policy is considered to be included in a contract by operation of law.” S.J. Amoroso, 12 F.3d at 1075. In S.J. Amoroso, as here, an improper clause was substituted for a proper clause. Id. As S.J. Amoroso held, “[a]pplication of the Christian doctrine turns not on whether the clause was intentionally or inadvertently omitted, but on whether procurement policies are being ‘avoided or evaded (deliberately or negligently) by lesser officials.’” Id. (citing G.L. Christian & Assocs., 320 F.2d at 351). The proper clause was consequently given effect. Id. at 1077.
    In this instance, inclusion of the clause prescribed for unregulated utilities constitutes such an impermissible deviation. See FAR § 1.401 (“Deviation means . . . [t]he omission of any solicitation provision or contract clause when its prescription requires its use . . . [or] [t]he use of a solicitation provision or contract clause . . . if such use is inconsistent with the intent, principle, or substance of the prescription or related coverage on the subject matter in the FAR.”). The text of the FAR is unambiguous in its requirement for inclusion of the proper change of rate clause: “The contracting officer shall insert clauses substantially the same as the clauses listed below in solicitations and contracts under the prescribed conditions.” FAR § 41.501(d) (emphasis added). The prescribed condition for inclusion of FAR § 52.241-7 is that the utility services “are subject to a regulatory body.” Id. As established supra, Bay County qualifies as an independent regulatory body, and as such, FAR § 52.241-7 is a required term of the utility contract. Correspondingly, FAR § 52.241-8 is inappropriate. Although deviations may be authorized by the agency head for individual contract actions, such a deviation must be documented and justified in the contract file. FAR § 1.403. No such documentation or justification is present here.
    Accordingly, the Christian doctrine applies and binds the contracting parties to the mandatory contractual term. See G.L. Christian & Assocs., 312 F.2d at 426 (“We are not, and should not be, slow to find the standard [regulation-mandated] article incorporated, as a matter of law, into plaintiff’s contract if the [r]egulations can fairly be read as permitting that interpretation.”). “Such regulations are law, binding on the contract parties” when otherwise applicable to the contract, Dravo Corp. v. United States, 480 F.2d 1331, 1333 (Ct. Cl. 1973), and “need not be physically incorporated into the contract,” First Nat’l Bank of Louisa, Ky. v. United States, 6 Cl. Ct. 241, 244 (1984) (citing Hills Transp. Co. v. United States, 492 F.2d 1394, 1396 (Ct. Cl. 1974)); see also Bethlehem Steel Corp. v. United States, 423 F.2d 300, 305 (Ct. Cl. 1970) (holding that the regulation need not be in effect when the contract was awarded so long as adoption of the regulation was remedial and intended to afford safeguards to the contractor). The court determines as a matter of law that the clause pertaining to independently regulated utilities, FAR § 52.241-7, is incorporated into the contract in place of the improper clause, FAR § 52.241-8, which is physically present."
  25. In 2010, the U.S. Central Command's Task Force for Business and Stability Operations, had a requirement for security services to facilitate investment and commerce in Iraq. This blog entry deals with the 2 competitive solicitations and contracts that led to a case before the Court of Federal Claims (COFC).
    Unfortunately for Tigerswan, the awardee of the 2 contracts under the solicitations, the contracts weren't rewarding--at least for the contracted items. (TigerSwan did claim damages of $56,246.24 on the first contract which DoD paid.)
    The first contract was terminated for convenience in a litle over a month. The second contract received a stop work order within days due to a bid protest. It too received a termination for convenience a little more than 3 months after contract award. Meanwhile, the incumbent contractor received sole-source work at the same time. What to do?
    Tigerswan filed a breach of contract claim to the COFC "arising from the termination for convenience of the last contract [solicitation W91GDW-10-C-6005] awarded to TigerSwan. For its breach of contract claim, [it] seeks $238,352.72 for lost anticipatory profits and $35,539.06 for line of credit interest."
    So what did the COFC say? Here is a short excerpt: "TigerSwan has alleged sufficient facts to demonstrate a potential breach of contract for improper termination for convenience based on the government's alleged 'abuse of discretion' and failure to honor its contract with TigerSwan."
    There is more to it than that. If you are interested in the whole case, you can read it at TigerSwan, Inc. v. U. S., No. 12-62C, April 2, 2013.

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