joel hoffman

Ask the assigned/appropriated point of contract for this acquisition. It doesn’t matter what interpretation we give you in this Forum.

Thanks, Bob

I read the Snyder Docket that Bob provided the link to above at https://www.supremecourt.gov/DocketPDF/23/23-108/299752/20240205125638057_Snyder Joint Appendix.pdf It appears that Mayor Snyder was prosecuted for soliciting and accepting a bribe(a) from the owners of a Peterbilt dealership for the purchase of two sanitation trucks for the City of Portage, Indiana. In addition, there were indictments for other bribes or gratuities. I didn’t see where the link includes the outcome of the case concerning the Peterbilt trucks. There were several days of testimony concerning the alleged nature of payments to Snyder for various alleged consulting services as well as interactions and communications between the parties. Im not a lawyer.

Interesting!

Ok, so the Feds can possibly prosecute him for accepting a bribe if they can prove it. The SCOTUS remanded the judgement of the US Court of Appeals for the Seventh Circuit and remanded the case for further proceedings consistent with the opinion. The former mayor is probably broke by now due to legal defense costs…

Bob, I reread and reread the decision looking for a connection to federal funds. I found that the only stated nexus is application to any jurisdiction “[that]receives more than $10,000 in federal funds per year”. It didn’t specifically mention any federal funding for the purchase did it? “Section 666(a)(1)(B) provides: "Whoever ... being an agent of an organization, or of a State, local, or Indian tribal government, or any agency thereof [that receives more than $10,000 in federal funds annually] corruptly solicits or demands for the benefit of any person, or accepts or agrees to accept, anything of value from any person, intending to be influenced or rewarded in connection with [ANY] business, transaction, or series of transactions of such organization, government, or agency involving any thing of value of $5,000 or more”; ... shall be fined under this title, imprisoned not more than 10 years, or both." And the maximum confinement penalty for an improper gratuity to a non-federal employee would be five times (10 years) greater than the confinement for a gratuity to a federal employee (2 years) if the statute were interpreted to include gratuities to non-federal employees. To me that would be ridiculous.

Bob, wasn’t Snyder convicted under the Federal gratuity law, which is the subject of the appeal? It doesn’t appear that there was a prosecution for accepting a bribe nor was there any mention of proof of that type activity on the locally purchased fire trucks. . There was no prosecution in state courts for bribery or gratuity. Edit: apparently Bob mentioned federal funding being involved here?

Agree. That’s what I was originally trying to say. And one doesn’t have to read four pages but I was unable to “copy” the text on my phone that I wanted to quote . Edit. See this from page five of the Decision: “The question in this case is whether §666 also makes it a crime for state and local officials to accept gratuities-for example, gift cards, lunches, plaques, books, framed photos, or the like that may be given as a token of appreciation after the official act. The answer is no. State and local governments often regulate the gifts that state and local officials may accept. Section 666 does not supplement those state and local rules by subjecting 19 million state and local officials to up to 10 years in federal prison for accepting even commonplace gratuities. Rather, §666 leaves it to state and local governments to regulate gratuities to state and local officials.”

The first four pages of the Decision explain the distinction, for state and local officials between accepting Bribes to perform an action and receiving a gift or gratuity sometime after the action.

Then shouldn’t the crime have been “accepting a bribe”, not a gratuity?

It seems that Congress, when it amended the original statute applying to state and local officials, did intend to differentiate between “rewards” to federal officials and state and local officials under a broad federal statute. The government never established/proved that there was any action or agreement between Peterbilt and the mayor to establish a bribe or connected gratuity to influence the selection of Peterbilt. State and local officials often receive gifts from the public or vendors. Why would the federal government define a uniform standard for post action gifts to non-federal employees when there are various non-federal standards or rules. After the Air Force Academy, where Honor and Ethics were Hallmark principles, continuously taught and stressed, I noted that the active Air Force climate was less rigorous in general practice but still evident. After active duty, I initially went to work for a City Government, where the standards for gifts was looser and where sponsored golf outings or other activities involving multiple public entities were common. There were state laws governing proper behavior and interrelationships, not involving bribery to a degree. But it appeared that Congress did not want to standardize such acts and prohibitions. Granted, a $13,000 gift or payment to a local official sometime after contract awards looks suspicious. However, the federal prosecutors apparently didnt tie them to any pre-award actions. But the amended federal gratuity statute didn’t apply to the situation. At least that is my viewpoint, partly based upon observations of local laws and widespread practices.

Per the thread title, it is a best value, trade-off. Per the opening statement, technical is more important than price. Ergo, it is not LPTA.

To elaborate on what Don described: “52.2804-19 As prescribed in 4.1202(b), insert the following clause. “ Incorporation by Reference of Representations and Certifications (Dec 2014) The Contractor’s representations and certifications, including those completed electronically via the System for Award Management (SAM), are incorporated by reference into the contract.” (End of clause)” So, no need to directly incorporate the Provision (which doesn’t include the certification and responses), right?

FAR 19.804-2 Agency offering, (a)(10) allows the agency to identify a specific source for a sole source 8(a) contract. This conflicts with the A-E selection procedures prescribed in 36.6 if the Agency skips the qualifications based competition selection procedures in 36.6 **edit- add: (to identify an 8(a) candidate for an ID/IQ to the SBA.) 36.101( b) “When a requirement in this part is inconsistent with a requirement in another part of this regulation, this part 36 shall take precedence if the acquisition of construction or architect-engineer services is involved.” The Brooks Act A-E selection procedures in 36.6 are statutorily mandatory.

NASA apparently has another perspective: https://doingbusiness.msfc.nasa.gov/documents/3128625/3479668/Helton.pdf/ec3e3094-7f6e-a30b-8a1a-32dcc3dc847d?version=1.0&t=1556915942299&download=true

Set-asides for 8(a), A-E contracts are allowed but must use the Brooks Act, Quality Based selection procedures. This is also discussed in Appendix J of EP 715-1-7. And yes, this is an Agency document. If you want to discuss the legal basis for the policy, you could contact the USACE proponent at HQUSACE . https://www.publications.usace.army.mil/Portals/76/Publications/EngineerPamphlets/EP_715-1-7.pdf See also: https://www.publications.usace.army.mil/Portals/76/Publications/EngineerPamphlets/EP_715-1-4.pdf

This is from the US Army Corps of Engineers Engineer Pamphlet 715-1-7 Architect - Engineer Contracting in USACE Appendix J “Procurements reserved for the 8(a) program must utilize the selection procedures outlined in the Brooks A-E Act including holding discussions with the three most highly qualified firms… “The Contracting Officer must have a reasonable expectation of receiving responses from a sufficient number of small businesses to proceed with an 8(a) procurement.”

H2H, I worked on some large DOD Systems contracts with one of the top DOD contractors that I believe you worked for. And other Systems contracts with one of the three largest US engineering and construction contractors. They both avoided filing claims in lieu of submitting REAs and/or less formal methods through the Partnering process. One REA from your former firm was for $63 million. We negotiated a settlement fairly expediently after the REA submission (for a fraction of that).

Vern, I didn’t mention it but in the various Corps of Engineer Districts (and the Division) that I worked for, we had personnel in the Construction Division at District or Division level assigned to make an independent review, evaluation and assessment of contractor claims, REAs and disagreements from the assigned Contract Admin Office and/or the KO. It depended upon who the action was for. We would generally involve and coordinate with Office of Counsel and the KO. We were supposed to review each situation from a neutral viewpoint. For issues short of dispute status that had merit or partial merit, we would so advise the field office. If the field office couldn’t resolve it, we would become involved in the negotiation with the contractor. If a pre-claim issue was elevated to us that had no merit, we could advise the contractor. That would sometimes resolve the issue. All claims were routed through our Construction Claims section for evaluation and coordination with Legal and the KO. If the claims had no merit, merit or partial merit, we would advise the KO in order to prepare a KO decision and/or for us to negotiate, as appropriate. There's more to it than I described but an important aspect is an independent review of issues at lower levels.

Specifically? The contractor here has demanded a final decision. It’s a claim. I agree with 33.204, including the use of arbitration when appropriate. We also had procedures in place to try to resolve controversies prior to a contractor elevating it to a claim.

I generally agree with Don here. Even if there are some other claims to defend, the $40,000 claim would likely, at least in my organizations, be handled by employees whose normal duties include or are dedicated to resolving or defending claims. Edit: It also can send signals to contractors that the government might not defend against claims in based on the cost or resources required to do so. It also may affect the morale of employees involved in administering contracts. It also depends upon the specific circumstances. We don’t specifically know the strength of the KO’s thinking concerning interpretation of the contract requirement. I do know that I occasionally had to convince some our organization’s legal counsel that a case is much stronger than they initially thought. Even Steve Feldman. So, yes - my personal opinion is based upon my experience in handling and resolving controversies, REA’s and claims at the working level and at the higher level.

Regarding the title of this thread: “What happens when politics and contracting mix”… It’s nothing new concerning politics over requiring organized labor agreements vs. allowing open shop labor on Federal construction projects. The following are excerpts from a Wikipedia article “Project Labor Agreements”. I was aware of the back and forth policies of the Presidential Administrations since GHW Bush but couldn’t remember the specific details of the policies. George H. W. Bush signed Executive Order 12818 prohibiting federal agencies from exclusively contracting union labor for construction projects. Bush's order prohibited the use of PLAs in federal construction projects. The Clinton administration rescinded this order when President Bill Clinton issued Executive Order 12836 in February 1993, shortly after he took office. This order allowed federal agencies to fund construction projects where contractors required a PLA. Clinton issued a memorandum on June 5, 1997, encouraging federal departments to consider the use of PLAs for “large and significant” projects. The memorandum required that government agencies review each project to decide whether a PLA would allow the agency to increase efficiency and reduce costs. On February 17, 2001, George W. Bush signed Executive Order 13202, “Preservation of Open Competition and Government Neutrality Towards Government Contractors’ Labor Relations on Federal and Federally Funded Construction Projects”, prohibiting the government or any other sponsor government from mandating use of PLAs for construction projects with federal funding. The EO rescinded Clinton’s Executive Order 12836. Specifically, the order declared that neither the federal government, nor any agency acting with federal assistance, shall require or prohibit construction contractors to sign union agreements as a condition of performing work on federally funded construction projects. Barack Obama signed executive order 13502, on February 6, 2009, which urges federal agencies to consider mandating the use of PLAs on federal construction projects costing $25 million or more on a case-by-case basis.This act served to revoke the Bush executive orders 13202 and 13208 from eight years earlier that prohibited government-mandated PLAs on federal and federally funded construction projects. The Obama order states that federal agencies can require a PLA if such an agreement will achieve federal goals in economy and efficiency. According to the terms of the order, non-union contractors may compete for contracts subject to PLAs, but they must agree to the various terms and conditions contained in each PLA in order to win a federal contract and build a project. A key change from the 2001 order is that by repealing the Bush orders, the Obama order permits recipients of federal funding, such as state, local and private construction owners, to mandate PLAs on public works projects of any size. However, the order does not encourage or mandate recipients of federal assistance to use a government-mandated PLA. INTERESTINGLY- Donald Trump did not rescind or change the Obama Administration policies on use of Project Labor Agreements. President Joe Biden's Executive Order 14063 of 28 Feb 2023 revoked Obama's executive order and requires PLAs on federal construction contracts of $35 million or more and established a training strategy for Contracting Officers.Federal Acquisition Regulation 52.222-34 is a contract clause for inclusion in a relevant construction contract, requiring maintenance of a PLA for the duration of the project. Not stopping there, the Biden Administration is strongly pushing states local municipalities and even private entities to require use of PLAs on Federally funded or non Federally funded and privately funded construction projects. As of March 2023, through legislation or by executive order issued by the state governor, 25 states have active laws banning government-mandated project labor agreements on state, state-assisted and/or local taxpayer-funded construction projects. State policies restricting government-mandated PLAs were repealed in four states following Democratic party takeovers in those state governments. Ten states have executive orders, or have enacted legislation authorizing or encouraging the use of PLAs on public projects.

Ahh. I didn’t answer your specific questions. I dont know. I do know that my KO’s would occasionally settle for somewhat more than our bargaining position in some cases in order to close the matter rather than have to significantly extend the life and cost of our offices in Saudi Arabia to litigate. We could have possibly ended up paying much more in settlement cost, plus interest. This was at the end of the USACE Saudi Arabia Assistance Program back in 1987 Our cost to the Saudi Government was more than ten million dollars per month to maintain the remaining USACE staff and our offices and support contracts. The Saudis paid all costs for the Assistance Program, including the Corps of Engineers’ direct and indirect costs.

If the government thinks that its case for no ambiguity is weak, I’d say it is appropriate to settle the dispute. The KO has the authority to settle the dispute.

Pretty much. Thanks! appears that the KO hasn’t made a convincing case to its lawyer.