joel hoffman

Does it have to b e a separate task or can it be a change to the task order?

I think I missed something. Seems like the question was both asked and answered in the same email, but its hard to tell on a Blackberry I feel that N&C's "Cost Reimbursement Contracting" is good but is more legal and theory than dealing with many day to day management issues and techniques. Look for references on "earned value" (efficiency), "project controls" (cost and schedule management), "earned value management systems" (EVMS) and work breakdown structures (WBS).

Single award task order contract? This probably is not a requirements contract or is it? Is this the only contractor who can meet your requirements? Are the tasks so integrally related that you have to use only them? If not, you can opt to compete the work, if the incumbent isn't wlling to meet a reasonable overall price for the proposal.

Can't read your mind. What kind of contract is this (service, supply, construction, etc.) and is it FFP or something else? What payment and prompt payment clauses are in the contract?

What type of a contract is this- services, construction, etc.?

Maybe the employee is charging to an indirect/overhead pool. That is common.

Maybe the employee is charging to an indirect/overhead pool. That is common.

If you are an 1102 and will be handling administration of construction contracts or claims, you really need to understand all of the construction contract clauses as well as contract interpretation issues, special situations like the suspension of work clause and Eichleay, defaults clause, etc. If you are with DoD, the DAU has a construction contracting course. I don't know how good it is. If you do any military or civil works construction, the Army Corps of Engineers has several very good training classes for contract administration purposes, among many, these are "must attends": Construction Contract Administration, Estimating for Modifications and Claims (teaches pricing principles for changes, claims, various clauses, etc.) Design-Build Construction and others. I personally feel that "Administration of Government Contracts" (4th Edition is now available) by Cibinic, Nash, and Nagle was the best book that I ever bought to learn the overall rules of construction contract administration, including contract interpretation rules. My latest edition is the 3rd Edition, before Prof. Cibinic passed in 2005. You can purchase the latest edition for about $105. I've seen that price for both hardcover and paperback editions via a GOOGLE search. I bought one once from our local college bookstore but they are available on-line. It is part of the George Washington University Government Contracts Program series. "Formation of Government Contracts" by is also a must have. I also subscribed to "Construction Contract Claims Monthly" for 25 years. Business Publishers, Inc. publishes this periodical. A subscription is about $327 on-line. If you cant afford that, you can read court and board case decisions at various websites. The ASBCA Decisions are available on-line for free, as I imagine are the civilian board's decisions. I also get daily notices from the GAO concerning GAO Protest decisions. Fed Claims Court and others may also be found on-line.

I agree with Vern. My opinion would be this. Why would one unilaterally award a cost contract at a price that you determined to be more realistic than that proposed without first conducting some meangingful discssions with the offeror? There would be no mutual agreement or even understanding of what is required or expected of the contractor let alone any mutual agreement on fee. Criminy, if you don't agree that the proposed cost or price is realistic, conduct discussions, verify that the cost is truely unrealistic, and I'd go with Vern's suggested approach of either a counteroffer or insist on a proposal revision to reflect a realistic price.

Are you or is your office willing to spend some money on reference books? Periodicals?

Yes, sorry I can't help. I had some textbooks and yearly supplements by Wiley or some other publisher on designer liability but left them with the taxpayers when I retired.

There must be a lot more to this than the seemingly simple sceanario that you provided. If you are specifically wondering whether government inspection of foundation construction would relieve the designer of professional negligence for a foundation failure, I don't see how it would unless the government actively engaged in the decision that the subgrade was adequate. Now, in order to hold the designer liable, the standard of care in design is that of the standards of the industry under the same conditions and for the location - thus, you must establish that the design or designer's actions are negligent with respect to the standard of care. Perfection is not the expected standard of care.

I hear you, Dave.

I think all the arguing and such takes more effort than submitting a brief plan that states you aren't going to subcontract anything and why you aren't or can't. What about materials and equipment purchases or this this strictly for services?

Section b with respect to what aspect? Section b is broad. When I retired from full-time duty, I left all my yearly books on A-E Liability and disputes in Huntsville. Are you thinking about the effect of government design reviews, in-depth calculation reviews, etc.? Approvals of furnished designs? Are you referring to the effect of payment for designs furnished? Are you trying to recover impact costs due to errors or omissions or just make the designer fix the design? If you are going to pursue A-E liability, you need the assistance of an attorney. This is in effect a government claim against a design professional.

Not knowing the circumstances or period of delay, I can't be too specific. The cost impacts are granted under the Suspension of Work clause and the time extension is granted under the Defaults Clause. Sometimes, delays may cause price escalation. I wouldn't include profit or fee on a constructive suspension of work. Pursuant to the Suspension of Work clause, we allow increased costs but no profit or fee.

I see two decisions and 16 protests.

Too "muddy" (= too cryptic) To let something go 5 years smacks me as incompetence and an insult to the US taxpayers. Somehow a contractor was allowed to change a production item from some contract requirement since FY 03 - perhaps on an earlier contract. We don't know. We don't know how. This is a matter for agency counsel to aide the present administrator, not a forum. If you don't have access to counsel, I suggest hiring a lawyer.

Sorry, apparently too complex a situation that you don't want or don't intend to fully explain how you accepted the VECP (the wording of the acceptance). Must be some type of annually funded production contract. Too many unknowns to help. Suggest you hire a lawyer then provide all the facts to him/her..

Please be clear. Did you accept the VE and tell the contractor to implement it with the price adjustment to follow on later? If you did, then a price adjustment is part of the deal and is necessary. It would be for all units produced after you directed implementation of the VECP, assuming that there isnt more to this story. Why do you need to rely on case law to understand that?

Price cannot be a factor or a selection criterion in a MATOC task order or base ID/IQ contract competition. FAR 16.500 (d) : (d) The statutory multiple award preference implemented by this subpart does not apply to architect-engineer contracts subject to the procedures in Subpart 36.6. However, agencies are not precluded from making multiple awards for architect-engineer services using the procedures in this subpart, provided the selection of contractors and placement of orders are consistent with Subpart 36.6. This means that, for a an A-E multiple award ID/IQ task order, the Brooks Act procedures in FAR 36.6 must be used to select the most qualified firm and price is then negotiated, where possible. If you can't settle on a fair and reasonable price, you move on to another firm. If the agencies are violating the Brooks Act requirements on a new contract competition, my opinion is that you may protest the terms of the solicitation. If you are a task order contract holder, you may also object to the terms of the task order solicitation. Engage a lawyer for details.

I really didn't want to get involved in this discussion. I don't think that Query has identified what clause is in the contract and what, if any, alternate paragraphs are included. The whole scenario is somewhat cryptic, because he/she hasn't explained how the VECP was accepted or directed by the government and if or how the action has been definitized, if the contractor has only proposed an adjustment to future units. Why would profit or fee be adjusted? The adjustment to current contract units or future contract units is based upon cost savings. I see no mention of fee or profit adjustment in 52.248-1 (I am assuming that some form of this clause is in the contract but I may be wrong).

Are you simply asking if you are entitled to a credit on units that were modified per the VECP after it was authorized or put on contract (by what means, I don't know) but before the unit price adjustment was determined? I would think the answer is yes, unless the modification containing the price adjustment somehow closed the action without considering the undefinitized units. In that case, the incomeptence of the contracting officer or administrator would amaze me.

"Question #1 - If it has been determined that the delay is both excusable (Defaults clause) and compensable (Suspension of Work clause), what is the best way to isolate the costs that should be considered for providing relief of actual costs for FOOH, Design and/or HOOH as a result of the delay? Typically contractors try to load up a cost pool to come up with a daily rate and then multiply times the number of days of delay. However, if there is no idle equipment and only very limited labor costs as a result of suspension, is there anything due the contractor?" For a delay period where little or no work is performed, the contractor could recover the fixed portion (those costs which are time dependant) of field office overhead as a daily rate. The trick is to isolate the fixed costs from other, variable costs (costs which vary based upon amount of work). Unless the contractor can establish the conditions precedent for "unabsorbed home office overhead, the additional home overhead costs would be payable as a percentage of other direct and indirect costs. Here is some discussion from P.J. Dick, Inc. v. Department of Veterans Affairs, 324 F.3d 1364 (Fed. Cir. 2003). Note, this may have been superseded by later decisions but was good guidance at the time. The Federal Circuit listed the questions a court should ask when evaluating a contractor?s claim for Eichleay (daily, unabsorbed overhead) damages: "1. Was there a government-caused delay that was not concurrent with another delay caused by some other source? 2. Did the contractor demonstrate that it incurred additional overhead costs? 3. Did the government CO issue a suspension or other order expressly putting the contractor on standby? 4. If not, can the contractor prove there was a substantial delay of indefinite duration during which it could not bill substantial amounts of work on the contract and at the end of which it was required to be able to return to work on the contract at full speed and immediately? 5. Can the government show that it was not impractical for the contractor to take on replacement work (i.e., a new contract) and thereby mitigate its damages? 6. If the government meets its burden of production as set out in Question No. 5, can the contractor satisfy its burden of persuasion that it was impractical for it to obtain sufficient replacement work? The court held: ?Only where the above exacting requirements can be satisfied will a contractor be entitled to Eichleay damages.? The Federal Circuit took a particularly close look at the fourth question in an effort to clarify what it called the ?multi-faceted? inquiry of standby. In the absence of an express order from the CO putting the contractor on standby, the court said, the contractor must prove standby by the following indirect means: 1. The contractor must show that the government delay was not only substantial but was of indefinite duration. (For example, when the government suspends all work on the contract but tells the contractor that the work will begin again on a certain date, the contractor cannot be on standby.) 2. The contractor must show that during that delay it was required to be ready to resume full work immediately. (Thus, when the government gives the contractor a reasonable amount of time to remobilize its workforce once the suspension is lifted, the contractor cannot be on standby.) 3. The contractor must show effective suspension on much, if not all, of the work on the contract." Source: "Construction Weblinks" by Howrey LLP at: http://www.constructionweblinks.com/Resour...03/eichleay.htm Regarding "design costs", what are you referring to? Not enough information to formulate any opinion or advice. "Question #2 - What would be the reasons to NOT issue a suspension of work, if you know there is going to be a delay in giving NTP or allowing some part of critical path works to commence? Isn't the contractor already on notice about suspension at the convenience of the Gov't, by virtue of the clause being in the contract?" From the clause and the above discussion, you should be able to see that: 1) You don't have to direct a suspension of work for the contractor to request an adjustment as a constructive suspension of work and: 2) It is potentially worse if you allow the contractor to be constructively suspended from performance of work for an indeterminate period than if you issue a formal suspension for a determinate period. If the period is indeterminate and the contractor is in limbo, it will more than likely be entitled to unabsorbed daily home office overhead, calculated using the Eichleay formula. If you issue a suspension for a determinate period, you might only be liable for any increased cost impacts, such as inflation or the like. If the period is indeterminate, you might be liable for both that and unabsorbed OH costs. You can issue a definite delay notice and if it needs to be extended, extend it. If the delay will certainly be resolved early, you can contact the contractor and ask if it could mobilize or remobilize earlier than the original suspended delay period.

It is a "utility contract", containing terms, conditions and rate schedules. The rates are set, subject to 52.241-7 or -8, which is supposed to be in the contract (along with certain other clauses). You pay for actual usage at the set tarriff rates, I presume. I suppose you could consider it to be an indefinite quantity contract.