joel hoffman

20 hours ago, C Culham said:

You then provide a hard "No" to your own question.   As a hard and fast rule under the contract represented how so? 

It wasn’t a “hard No”. If a FFP or task order has already been priced and awarded and the prime awards a  cost reimbursement subcontract that doesn’t affect the price the government pays, then it might be okay for the government. Maybe not so for the prime.

The reason I say that is I’ve dealt with a VERY large, Union prime contractor that couldn’t find a FFP electrical subcontractor for a huge, complex FFP construction project.

So they entered into a cost reimbursement arrangement with a Hanford, Washington area firm with the Hanford Union workforce, hoping to closely manage the CP effort.

The result was a disaster for the prime. The electrical labor inefficiency (65+% overrun) affected the other craft labor trade productivity and the project schedule.

53 minutes ago, C Culham said:

@ShaunaMSACM  My apologies for bringing deviation into the discussion for this instant matter.   I am in agreement it would not work as Federal Acquisition Streamlining Act (referenced USC already provided) provides the exception to use of cost type contracts.

 

Now to @joel hoffman

First things first but in reverse order.   This is US DOT Maritime Administration.

You then provide a hard "No" to your own question.   As a hard and fast rule under the contract represented how so?  

Because the government would be purchasing commercial products or services using cost reimbursable pricing passed through the prime level to the government. 

16 hours ago, ShaunaMSACM said:

I just learned something new - I didn't know that a one time deviation was an option! Who would have thought that a contract like this one was even possible for that matter?  It definitely keeps me on my toes 😉

A deviation here from applicable law isn’t an option. Anything is “possible” if the acquisition team ignores the Administrative Regulations and statutes.

20 hours ago, Retreadfed said:

The use of cost reimbursement contracts to acquire commercial products/services is prohibited by statute.

The next questions are:

1. Can the agency legally issue cost reimbursement task orders for commercial products or services under this contract?

2. Can the contractor legally issue cost reimbursement subcontracts that would bind the government to reimburse the prime on a cost plus subcontract basis?

My answers would be apparently, no. I found no contradictions or exceptions to the prohibition in DFARs, either, if this is a DoD agency acquisition..  

18 hours ago, Retreadfed said:

41 U.S.C. 3307(e)(4)

Thanks, Shauna. It appears to be inappropriate and/or contradictory. 

It also says that it is Performance Based Service acquisition (50% or more is PBA) Do you know which line items are applicable? 

Also said it was competitive, Best Value Tradeoff with four offers but Cost or Pricing Data were required??? 

31 minutes ago, Retreadfed said:

Joel, how do you square this statement with FAR 12.102 particularly (a) and (b)?

As I previously said, it’s  not a commercial product or commercial service contract under FAR Part 12. Then, FAR Part 12 isn’t applicable to the contract described herein.

The services are of the type that would otherwise be “commercial services” if priced as FFP.

9 hours ago, jtim said:

The [first] contract does not condition payment on the number of hours worked or satisfactory completion of a task. 

I think that there should be a payment clause in the contract in addition to the DFARS clause at 252.232-7003 Electronic Submission of Payment Requests and Receiving Reports. See paragraph (f) of that clause:

“(f) In addition to the requirements of this clause, the Contractor shall meet the requirements of the appropriate payment clauses in this contract when submitting payment requests.”

The scope of Subpart 232.70 - “ELECTRONIC SUBMISSION AND PROCESSING OF PAYMENT REQUESTS AND RECEIVING REPORTS “prescribes policies and procedures for submitting and processing payment requests in electronic form to comply with 10 U.S.C. 4601 (procedures for submitting and processing electronic invoices).

It would appear that you aren’t fully complying with the statement of work requirement to work 40 hours per week,

Thus you may be partially non-compliant with the terms of the contract but appear to be invoicing for work that is specifically required by the contract. 

Carl, sorry, I should have clearly stated that,  yes- you can use a non- Part 12 service contract to acquire cost reimbursable services of the type that would otherwise be “commercial services” if priced as FFP.

On 10/15/2024 at 7:45 AM, C Culham said:

Structured as the agency did in the solicitation it did not result in [Part 12]* commercial services contract.

*Added by me. 
Perhaps the reason for not using a Part 12/13 Commercial Services format here are the prohibitions at FAR 16.301-3 (b) and FAR 12.207 (a) against using such format for acquisition of commercial products or services priced as cost reimbursement.

I mentioned the FAR 12.207 (a) prohibition early on in this thread but it wasn’t acknowledged or challenged. Instead, everyone here seems to wonder why it isn’t structured as a Part 12/13 commercial item contract.

 16.301-3 (b)  “The use of cost-reimbursement contracts is prohibited for the acquisition of commercial products and commercial services (see  parts  2 and  12)“

“12.207 Contract type.

(a) Except as provided in paragraph (b)* of this section, agencies shall use firm-fixed-price contracts or fixed-price contracts with economic price adjustment for the acquisition of commercial products or commercial services.”
* discusses conditions for use of  time and materials contracts for acquiring commercial items and services.

As another example, most of the products commonly incorporated into most construction contract building or horizontal utility projects are “commercial” products (as opposed to Federal Spec specific items for instance). There used to be “Federal Specifications” (FEDSPECs) and/or Military Specs (MILSPECs) for almost anything back in the day before commercial specs were widely standardized**. That doesn’t make a construction contract a commercial product or services acquisition, because of many other factors that affect the cost or price of the acquisition.

So why can’t you have a service contract for such services when the Part 12 formats aren’t applicable due to the type of pricing used.? Yes, you can use a non Part 12 service contract for cost reimbursable services. Non Part 12 service contracts were used for decades before Part 12 was developed. Part 12 commercial item contracts accommodate simpler means to acquire common industry standard products and services (when priced as FFP or certain T&M) , as opposed to requiring government specific,  specified products and services.

** I remember reviewing product submittals for toilet partitions that had specific Federal Specifications or Military Specs, comprising several pages of detail. Heck, there were FED or MIL specs for screws and nails, even!  We also had Federal Specs for almost any kind of soil tests, Portland Cement Concrete, Asphalt Cement and Coal Tar Cement paving materials and mixtures, density testing services and many other services. Now the industry standard specs are usually adequate.

On 10/10/2024 at 3:56 PM, Vern Edwards said:

P.S. You said, "Being cynical, all a contractor has to do under a cost reimbursement contract is spend the government's money."

Someone else said that, not the original poster. 

On 10/10/2024 at 10:19 AM, ShaunaMSACM said:

All, thank you again for your patience while I am on the mend from the fall.  In addition to breaking fingers, the doctor thinks that I also dislocated others, so my recovery is moving slower than I had hoped.

@C Culham  FAR 52.216-18, 52.216-22 and 52.243-1 are in the IDIQ contract.  You mentioned that the initial solicitation for the parent IDIQ would be a very interesting read.  Here is a link to it on SAM.gov: https://sam.gov/opp/25276e239dad42e6b6b3b1a5d459a1c4/view.  You will not be disappointed.  It is unlike any contract I've supported in 20+ years.

@joel hoffman Please see Sections B & C in the solicitation.  Nearly all services and products under this contract meet the definitions of "Commercial Services" and "Commercial Products".  The services in this contract are core to my company; we sell them to commercial customers across the globe.

@Vern Edwards Thank you for your input on this thread and I appreciate the bonus learning opportunity re: agency relationships.  I always learn something new in your posts!

 

@shaunaMSACM, thanks for the link. I’m out of town and it’s very difficult to try to read the solicitation on my cell phone where I am. I read the description of the intended services but will read the details later. However, my original post asked how a commercial products or commercial services contract for inspecting and refurbishing a ship can be priced as cost reimbursement? And the change clause cited is for fixed-price (task orders).   I’ll read the details… 

Are you asking:

1. if an original cost reimbursement contract task can be modified to use the “new technology?

or as an alternative,

2. Can the task can be transferred from the original contract (by deletion change? or a partial termination for convenience?) and added to an existing “follow on” contract that is using the new technology ? 

On 10/2/2024 at 3:15 PM, Neurotic said:

I know what a full time employee is, and I don't think the individual is working full time. Still, that again is not relevant to the issue because is not defined in the contract so is not a requirement. What I know or think is separate from what the contract says but that should be clear to everyone. Thanks, always appreciate everyone's input

Is the QA function required to be full-time when work is being performed and is the work being performed on-site or off-site?

Edit: One point is that, regardless of the limitations of the contract language, if the employee’s  full cost of salary and fringes, etc. is being charged directly to the FFP portion of the contract in the company’s accounting system, there is no extra COST to the company for performing the cost reimbursable tasks. Then the company is double charging…

On 9/26/2024 at 7:00 AM, Neurotic said:

The agency requested, and the vendor proposed named Key Personnel for various labor categories within this CLIN, to include a full time "Test Manager" (for Quality Assurance*). The Key Person's names were incorporated into the contract. 

*Does the contract require full time quality assurance? What is the role of a quality assurance test manager?

On 9/26/2024 at 9:53 AM, Neurotic said:

The contract does not define "full time". Not only that, just found out there is no actual requirement in the contract for Key Personnel to be full-time*.

On 9/26/2024 at 9:53 AM, Neurotic said:

The contractor may have "promised" full time in their proposal but if it's not in the contract I would say is meaningless now. So what I see is a contractor performing on an FFP, which includes a Key Person, whose effort is not clearly defined, and that is also working and charging a CPFF CLIN.

I don’t believe that the contractor incurred any additional cost for the person who performed the additional tasks, assuming that you have verified who performed the task and that the tasks were performed during normal duty hours. You have the right to find out who performed the tasks.

The contractor proposed and is essentially charging you in the FFP contract price for a full time employee. Is that correct? 

Now the contractor is charging you again for some of that same person’s time. That is double charging in my opinion.

Under cost reimbursement, the contractor has to be able to show that it incurred a cost to perform the task.

I don’t think that the contractor can prove that there is any additional cost incurred to perform those reimbursable tasks if it is already paying the person and charging it to the contract in its accounting system.

Is the person an hourly or salaried employee? If salaried, it (probably?) already incurred a cost to the contract that it supposedly included in the contract price.

Did you say whether the employee is working full or part time on the job? Is this an on-site or off-site employee? I may have missed that

For a cost reimbursement CLIN, It is the contractor’s responsibility to justify the additional cost to the contract to be reimbursed. You didn’t say that it is a time and material CLIN. I didn’t see where you or the COR/KO required the contractor to or where the contractor substantiated the additional cost to be reimbursed. 

15 hours ago, Neil Roberts said:

@Retreadfed, just trying to learn more about government interaction between an agency and the contracting officer. Does a contracting officer yield any authority to establish or approve contract language or do they just administer a contract that is given to them by an agency? Why is the "agency" called out as the party that "screwed up" vs "the government?" In my contractor world we would say the company screwed up, not the program office or contracts office or supplier management (ok maybe if we knew, internally we might pin it on one of the acting participants in the contract.) Not picking on you. Have heard this said before about "agencies" and have always wondered about it. Thanks!   

The “agency” includes the KO, too. There is an acquisition team.

Covey’s “Begin with the end in mind” is a great Habit for “Highly Effective People”.  It was a life changing training course for me.  I highly recommend everyone attend “The Seven Habits of Highly Effective People”, especially here for acquisition personnel and negotiators.

Vern, I never said that the writing is effective or isn’t crappy. Old habits don’t seem to go away. “That’s the way we’ve always done it here” is the norm.

I was responding to your musing about whether it should more properly be called “Findings and Determination” when the FAR format for a D&F requires the findings first then the determination.

i told you “why [I referred to] the Army writing guide”, not the Air Force, GPO or Navy guides. I worked for the Army for 35 years and learned about the “New Army Writing Style” in 1988, about four years after the Reg had been published. It was an eye opener for me at the time but completely foreign to the standard writing style then and now. 

Do you disagree with the Army’s defined  “essential writing style” of “bottom line upfront” (BLUFF)?

Ive noticed that some of the recent legal decisions state the high level  outcome up front before going into all the details and findings.

Other decisions seem to lumber on with the details then finally describe the bottom line.

And writing in the passive voice drives me crazy. I edited numerous regulations and guides during my last decade with the USACE. I gradually revised all versions of the USACE Model RFP used for the $50 billion Army Transformation construction program from 2006-2013, as a member of the Program Management Team, to convert passive voice to the active voice. Also removed most of “the contractor shall” and “by the contractor”, excess wording.

I’m sure that later revisions and additions likely reverted to the passive voice. 
 

A Determination and Findings (D&F) should not be renamed Findings and Determination (F&D). Unfortunately, The current FAR  D&F format is backwards from the title and should be reversed.

As Stephen R. Covey said in Habit 2 of his book The 7 Habits of Highly Effective People® , “Begin With The End In Mind”.

From Army Regulation (AR) 25-50 ,

“Section IV Effective Writing and Correspondence. The Army Writing Style.”

Paragraph 1-38 is “Army Standards for Writing”

Besides writing in the Active Voice, the other essential writing requirement is to  put the main point at the beginning of correspondence*. “Bottom Line Up Front” (BLUF).

The current FAR format for a Determination and Findings at 1.704  Content places the findings at (d) before the determination at (e). See below.  In my opinion, this format should be revised so that the determination is first  at (d), followed by the specific, supporting findings at (e).  

Current wording at 1.704:

”(d) Findings that detail the particular circumstances, facts, or reasoning essential to support the determination. Necessary supporting documentation shall be obtained from appropriate requirements and technical personnel.

(e) A determination, based on the findings, that the proposed action is justified under the applicable statute or regulation.”

Reversing this order would make the format consistent with  the title as well as the current Army writing style.

Footnote: I don’t claim to be a particularly effective writer.  However, our Kaiserslautern, Germany Army Corps of Engineers Area Office Commander, a Lt. Colonel,  made all AO employees take an Effective Army Writing Class in 1998.

A majority of our AO staff were German National engineers and support personnel with English as a second language. To put it mildly, their English writing needed much editing to finalize…

I do give them MUCH credit for learning our language, especially given the different grammar structures.

The Colonel said he didn’t want to single out the German’s, so he mandated that everyone take the class.

The class was based upon the 1984 update of AR-50. Section IV was entitled, “Effective Writing and Correspondence. The New Army Writing Style.”

It was a great class for me, in particular the two essential writing requirements (use the Active Voice and BLUF).

I had been in the Air Force for nine years and in the Corps of Engineers for eight years at the time. Neither of those two essential styles was the norm in the Air Force or the Army Corps of Engineers.

*A memorandum is one of the specific forms of correspondence described in AR 25-50. 

I have never heard of a “unilateral agreement”. An agreement consists of concurrence by the contract parties concerning some matter.

Do you mean a unilateral decision by the government to determine entitlement to an excusable delay and establish or deny a time extension?

How is a contract or task order when acquiring products or services priced as cost reimbursement or cost reimbursement with fixed fee a FAR commercial product/service contract?

” 12.207 Contract type.

2 hours ago, Vern Edwards said:

Deliberate mischarging is considered contract fraud.

47 minutes ago, Voyager said:

Is the burden of proof on me to prove another scholar's position true?

Who was the scholar and what is the source ? Did I miss it?

8 hours ago, C Culham said:

We all need an advocate to free us of the burdensome procurement rules and regulations that result in contract terms and conditions intended to defend against the litigious society we now live in.

My Verizon agreement for simple cell phone use is 9 pages but I would offer that if all references to such things as the collection agency and the Federal Arbitration Act processes were downloaded it too would expand to hundreds of pages.  Yet like the guy that simply provides maintenance services I simply use my phone.  But the day it's use becomes troublesome I get mired in a bureaucracy that in my view is worse than the Federal government.

My point being it will take a collective effort far beyond the halls of government to change the "business" processes we drowned in everyday.

Way to go, Carl. Putting this in perspective,  is the government worse than the myriads of ridiculous terms and conditions imposed every day by businesses. What I think is especially ridiculous are all the exceptions written into the warranties, etc. that you can’t read until you buy the product and open the package…

33 minutes ago, formerfed said:

Somehow my original link changed or was faulty.  I can’t find it to repost.  But I’ll keep looking.

@formerfed, is this the article:

23 hours ago, Jamaal Valentine said:

The title reminds me of something I read recently. The author discusses how tribunals create rules that are much harder for acquisition teams to find, read, and understand than statutes and regulations. 

When Recommendations Become Requirements: How the GAO’s “Non-Binding” Bid Protest Decisions Create Unofficial Procurement Rules Contracting Officers Are Expected to Follow. Michelle L. Miller. Public Contract Law Journal, Volume 53, Number 3, Spring 2024.

 

16 hours ago, formerfed said:

…

Did you mean to say something, formerfed? 🤠

On 9/4/2024 at 6:17 AM, C Culham said:

Why?  As others have stated the Firm Fixed Price is the Firm Fixed Price!

On 9/4/2024 at 10:16 AM, Vern Edwards said:

Please clarify.

If the task orders are FFP, then what does the program office want to know? Does it want the contractor to report their actual costs as opposed the amount invoiced? If so, does it want that information in order to judge the reasonableness of the contractor's prices?

On 9/4/2024 at 12:01 PM, Retreadfed said:

Are you talking about invoices for completed and accepted work or are you talking about progress payments?

On 9/5/2024 at 11:47 AM, C Culham said:

You say cost proposals required by contract. Okay, but does the parent contract say CDRL's will be, or may be required on TO's?  As noted in a previous response the contractor may be right, you are asking for something not required by contract language.  

On 9/5/2024 at 3:03 PM, joel hoffman said:

Is “now” before finalizing the task order or after bilateral agreement and issuance?  

21 hours ago, REA'n Maker said:

Have you considered the possibility that your program office is a bunch of idiots? Overheads, etc., are not in the program office's purview regardless of the contract type scenario.

Is the IDIQ single or multi-award? If it's under Part 36 that has implications as well.

 

18 hours ago, formerfed said:

LOML hasn’t come back with additional information so we’re left with speculation.

LOML has disengaged from the thread after 3 September,  leavingw many responders’ questions unanswered and much speculation.

I suggest we not waste any more time continuing to respond…