joel hoffman
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Posts posted by joel hoffman
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Edited by joel hoffman
12 hours ago, Tzarina of Compliance said:…the lease price is below the market that is offered by the owner.
Please clarify. What does “below the market that is offered by the owner” mean? Are you saying that the lease price is below the market price and is reasonable in amount?
12 hours ago, Tzarina of Compliance said:Would this be an allowable indirect cost (this is the main office for the contractor)
Please clarify. Are you saying that it would be included in the G&A pool and that it “is” (already)(?) or did you mean “ it will be”(?) the “main office” of the contractor?
Where is the firm’s “main office”now?
Does the “main office” serve the contractor’s other contracts too (I.e., the total cost denominator for G&A includes the total cost of company sales or similar designation)?
Just need to understand the full context of the scenario. Thanks.
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On 9/3/2024 at 2:11 PM, LOML said:
Now, the CTR is coming back and saying, per the contract type, the CDRL requirement is not valid, and they are not required to do it.
Is “now” before finalizing the task order or after bilateral agreement and issuance? If before, II definitely would agree with the contractor. If the contractor agreed with the requirement during the negotiation of the task order and later balks, I’d disagree…
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On FFP construction contracts for lump sum CLINs, the Corps of Engineers for decades has required and obtained rather high level breakdowns of the CLIN values - to assign to schedule activities for tracking progress and for preparing progress payment invoices. It might include percentages of labor and materials and sometimes mobilization share of the CLIN price. If a lump sum activity was subcontracted, they would provide that value and any high level breakout. But I’ve never seen a requirement for reporting detailed actual costs for the direct and indirect “costs” for invoicing on lump sum CLINs. We’d use the percent progress performed.I do remember one large RR bridge and trestle project where the subcontract cost for the bridge fabrication and materials was more than the entire CLIN price for the installed bridge. So they had to prorate the subcontract cost for the fabricated bridge materials, shipping and installation for progress estimates. Of course they made up that underbid item on other parts of the project.
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This is probably a rhetorical question. But if you are using anther agency’s contract, wouldn’t it be appropriate to CALL or otherwise contact THEM first for an after the fact question about using their contract? Like asking “what happens if one of the schedule holders emailed their quote instead of submitting it through the EBuy system?”
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@C Culham, yep probably so. Likely a lesson learned not to assume that submission requirements are totally specified in the EBuy system. Also to read all the GSA instructions…
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Seems like it would be wise to see if the GSA contracts contain any conditions requiring submission of quotes through the EBuy System.
NewbieFed appears to have assumed that it was an “obvious” requirement that Newbie didn’t have to specify.
Apparently, the RFQ contained an email address for some reason. If it didn’t, how is it appropriate to send a quote via email? If it did, was there a stated purpose for the email address?
If the EBuy route is not an inherent requirement, it’s a lesson learned to specify how to submit quotes.
Seems like a simple solution here.
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On 8/26/2024 at 9:36 AM, Vern Edwards said:
@joel hoffman and other interested persons:
See the September 26, 1980 memo from GAO to OFPP, subject: Should Small Purchases Be Exempt from Complying with Social and Economic Program Requirements.
I think you'll find it interesting, especially the discussion of raising applicability of Davis-Bacon from $2,000 to $10,000. Note the discussion of arguments pro and con.
I address the memo in my N&CR article.
Looking forward to your upcoming article, Vern.
The 1980 GAO memo to OFPP is very informative and mirrors much of my arguments.
Even then, GAO was indicating that there was no need for “protection” for organized labor for small, relatively insignificant projects below the then $10,000 simplified acquisition limit, let alone a $2,000 threshold. Such contracts were reserved for small business firms.
Those firms generally aren’t unionized and are burdened by administrative costs and manpower resources to comply with D-B. The GAO said that the D-B protections were designed for workers on large project [not minuscule projects that would likely be performed by non-union employees anyway].
Sorry for rambling. I’m done now.
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4 hours ago, formerfed said:
No other agency has such a strong and enthusiastic constituency base as Labor. Unions fight tooth and nail against anything that reduces their power. They will view increases in contract thresholds as weakening their position as staunch supporters of labor, even if the increases are trivial by today’s dollar equivalency.
As an example, the Davis-Bacon threshold was higher ($5000) 93 years ago than it is now. They lowered it 89 years ago to $2000. That’s longer than anyone here has lived.
Trivial? That’s an understatement. A dollar then was worth over 20 times what it is today. Today a dollar can buy about 4.4 cents of what a dollar could buy back then. My dad earned $1 a day plus meals and a cot in his Army run CCC Camp in 1933. $2000 was equivalent to 2000 man days of work. 🤪
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51 minutes ago, joel hoffman said:
Unionized contractors likely won’t bother with minuscule contracts with very little labor hours but with the administrative expenses to comply and report, Union work craft rule restrictions, etc.
Carl, when you have to use multiple trades to perform a tiny amount of work…which is reserved for small business firms anyway, it’s not practical for Unionized contractors. So there is no need to “protect” or promote union labor on such small jobs.
But it probably will be the same for Longer time. Common sense isn’t evident here.
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On 8/19/2024 at 9:43 AM, WifWaf said:
I am looking for the area of statute, CFR, or case law where WIFCON believes the following quote rings most true. Be objective with facts. Maybe rely on the Section 809 Report's legwork, but be creative too.
Alternative, intervention-promoting viewpoints are also welcome here.
On 8/20/2024 at 5:16 PM, Vern Edwards said:Six sentences. From them I extracted the following statements asserted to be facts:
- America's core principles include promoting freedom to operate.
- The hand of government gets heavier every year.
- The laws and regulations accumulate every year.
- The laws and regulations are immortal.
On 8/21/2024 at 11:38 AM, formerfed said:The Service Contract Act, enacted nearly 60 years ago, has a threshold of $2,500. That amount never was increased just to make organized labor happy.
On 8/21/2024 at 4:06 PM, joel hoffman said:Davis-Bacon threshold is similarly enshrined at $2000…
On 8/22/2024 at 6:44 AM, Vern Edwards said:As long as there is a chance for change there is hope (and fear). Statutory repeal and deregulation have happened and will happen again.
On 8/23/2024 at 8:50 AM, WifWaf said:And the resulting complexities are daunting today. Were they ever less daunting?
On 8/23/2024 at 7:39 PM, Vern Edwards said:Are those supposed to be arguments that might persuade Congress to repeal or revise a law that is actually or symbolically important to a politically powerful constituency like labor?
Is that all you've got? Bureaucratic inconvenience and confusion?
Surely, Joel, you can do better. (I'm not sure about WifWaf.) Why don't you stop posting and think about it?
How is the present dollar threshold for Davis-Bacon bad for the system and the country? What's your argument?
On 8/24/2024 at 7:52 AM, Vern Edwards said:I'm not disagreeing with you. I'm just asking for specifics that will explain your point of view. D-B seems like more of a problem for big contracts than for small ones.
Nine hours ago, @ji20874 posted: “Joel,Are you trying to make a case for a change? Fine with me if you are, but I don’t think Wifcon.com is where you need to make your case.”
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ji, have you followed this thread? Yes, I responded to the subject of the thread. I simply mentioned that the $2000 Davis-Bacon threshold appears to be immortal.It’s been the threshold since 1935. The original 1931 threshold was $5000 but was lowered, as part of efforts to end the Great Depression, to $2000. You can read the history of the Davis-Bacon Act at Wikipedia.com
Then, I was challenged to explain why it’s “bad for the system and the country” and why it’s burdensome.
The conversation eventually got around to the likelihood of the DB threshold being increased.
It appears that it won’t likely be raised.
A dollar in 1935 is worth $22.69 in 2024. I wouldn’t advocate raising it that much. But a comparable amount of construction work within the current threshold is about 4.4% of what you could get in 1935.
And labor productivity was much lower then, resulting in larger labor crews and total labor hours to construct a project. Means, methods, materials, tools and equipment have greatly increased labor productivity.
If most of the 88-90% of the US construction industry workforce is willing to work as non-union craft labor, is there a need to retain a 1931 ($5000) or 1935 ($2,000) Depression Era threshold for application of primarily union based wage rates.
Almost all, if not all states, have adopted minimum construction wage rates.
In fact, when I was still active in construction contracting as late as 8 years ago, actual wages on our job sites often exceeded the DB minimum wage rates due to market competition for craft labor.
This thread intended to discuss, in part, regulations and laws that, once Instituted, tend to live forever, regardless of whether or not they are still necessary.
Unionized contractors likely won’t bother with minuscule contracts with very little labor hours but with the administrative expenses to comply and report, Union work craft rule restrictions, etc.
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Carl, did your research show you that DOL has recently decided to revert to methods used to determine Prevailing wage rates that are essentially based upon organized labor bargained rates, even though they might not be “prevailing” for the locality
This is the way it was done a relatively long time ago in the seventies and 80’s. I don’t remember when that was changed to reflect more actual prevailing rates.
Now it seems to be back during this Administration. So wage rates applicable to a small minority of the workforce may now again be considered the prevailing rates…
It was posted on WIFCON awhile back, complete with the DOL “spin”, justification.
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5 hours ago, formerfed said:
It probably is more difficult now to increase the thresholds as it was in the 1980s. Wage determinations are online and contracting personnel can access without the delays from the past. DoL will fight and say the administrative effort on contracting is nil.
The administrative effort on the part of non-Union contractors isn’t nil. 88-90% construction employees are non-Union, generally including those working for small business employers. Local Small Businesses would be the industry market for very small construction contracts (generally reserved for small business anyway) assuming the DB threshold would be raised to say$10k.
Remember that the labor share of $2k-$10k minor construction/Maintnence/repair contract would generally be a small percentage of the total price, which also would likely include, materials, tools and equipment, supervision, overhead and profit.
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19 hours ago, Vern Edwards said:
You know that. Why go on?
@Vern Edwards Because Saturday, you asked me to go on (“provide specifics”). Did you forget?
I thought I’d already made my point. You had appeared to believe that there was some value to the construction workforce in keeping the threshold at $2000.
However, in response to your Saturday request, I provided some specific details for my reasoning against retaining the threshold.
Yes, “I know” and am glad we agree that the DB threshold should be changed and that we agree Congress and the President won’t change it.
None of them know anything about it. It’s purely political, in almost meaningless support for the 10-12% portion of the US construction industry labor force that is unionized.
That’s why the $2000 DB threshold is practically or seemingly “semi-immortal”.
Those unionized construction firms likely won’t bother seeking or taking on a $2000 or even larger small construction contract. Those can be relatively easily procured from local small business firms using simplified acquisition methods.
Seemingly Immortal laws and regulations was a point in the original post quoting Elon Musk and in wifwaf’s summation, both of which you challenged.
it’s interesting that even some of the largest US construction firms have separate Union and non-union companies (e.g., Bechtel). It’s called “Double-Breasted Operations”.
I’m done too, thanks.
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On 8/24/2024 at 7:52 AM, Vern Edwards said:
I'm not disagreeing with you. I'm just asking for specifics that will explain your point of view
@Vern Edwards Ok. See next post.
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Vern, the specifics are that a $2000 construction job probably wouldn’t take more than a day or so at the most. The labor is only a small fraction of the total cost, including materials, any equipment and materials plus the overhead and markup. The administrative costs for a contractor to comply with the D-B wage rate requirements for a minuscule job involving a few man hours would likely be burdensome, especially for a small business, non- union contractor.
I doubt that many if any Union contractor would bother with a small job. Many union contracts include show up pay requirements, such as at least four hours, even for a one to three hour workday.
There are also strict limitations on what Union employees are allowed to do, leading to the need for additional crew members and/or separate trades for routine work that one or two persons can accomplish. Add the additional paperwork burden to that.
Only between 10-12% of the nationwide construction workforce is unionized. Many of those work on large projects.
Apparently you believe that the 88-90% non-union workforce are being taken advantage by their employers and it would serve the nation well to pay everyone union wages and benefits.
If a non-union employee performs more than one trade on a small job, do they have to keep track of the different trade times? Probably just get paid the highest rate.
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What good does applying Davis-Bacon, essentially requiring Union labor rates to simple tasks, that may take a couple of hours to perform, provide the country, labor or the system?
The “system” has recently reverted to determining, in practice, “prevailing wage rates” based on local Union rates, even where union labor is a small fraction of the labor force. DOL stopped doing that probably 20-25 years ago. Now it’s back.
Bureaucratic inconvenience?????? Come on Vern. Unnecessary, wasteful complexity for minuscule tasks that doesn’t effect any real difference in a workers pay.
Most small construction tasks are performed by small businesses, who likely aren’t unionized in most parts of the country. Union contractors probably won’t even bother contracting for such small jobs.
$2000 total cost is minuscule in scale. Why over complicate it.
I could talk for days about dealing with the Tri-City, Washington unionized labor force at Umatilla, Oregon that built the Chemical Weapons Demil Plant. (Example: three electricians carrying a 20’ , 3/4” piece of electrical conduit that probably weighs 5 pounds or less across the site from a storage trailer… the prime had electrical labor overruns of 165% on a huge FFP contract that affected the other trade productivity.)
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That’s what I’ve been trying to determine. It appears that if there has been a delay you may be entitled to a compensable time extension for additional efforts, depending upon the specific additional services provided beyond the agreed completion date. You should be able to submit a Request For Equitable Adjustment for the costs and maybe for overhead and profit. Don’t have all the facts and your contract language.
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26 minutes ago, ji20874 said:
GSA is offering something for the optional use of other agencies. Any agency not liking GSA's ordering guidelines can establish its own no-cost contract.
If GSA's ordering guidelines say considering past performance is required, then it is required -- and it's required because the ordering guidelines say so.
To me, the OP's demand for a FAR citation seems inappropriate.
Agree. If you don’t like it, don’t use their contract vehicle.
FFP cost breakdowns
in Contract Administration
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…