Matthew Fleharty

Also recommend you read FAR Subpart 11.6 "Priorities and Allocations" and 15 CFR 700.13 "Acceptance and rejection of rated orders"  (https://www.law.cornell.edu/cfr/text/15/700.13)

16 minutes ago, jtolli said:

The first order to satisfy the minimum order guarantee was issued at the time of contract execution.

Do you have a source for this information?

UVA (and others),

Go to regulations.gov and in the search bar type in the appropriate FAR Case (in this case you would type "FAR Case 2016-005") and the first hit should be the right one.

Click on it - at the top of the page you'll see a link that says "Open Docket Folder" - click that.

On the next page you should be able to see a number of sections titled "Primary Documents," "Supporting Documents," and (the one you're looking for) "Comments."  Next to the comments header is a link that says "View All" - click that and you should get what you're looking for.

Happy researching!

Did your source(s) say no funding has been appropriated or that the minimum order wasn't executed?  I'd find that hard to believe for a contract of this magnitude as fulfillment of those criteria is an IDIQ 101 lesson.  The more likely case is that the order for the minimum amount (whatever it might be) got lost in the noise of the announcement of the overall contract.

Here is the link to the decision:

https://ecf.cofc.uscourts.gov/cgi-bin/show_public_doc?2016cv1259-38-0

That book (Thinking Fast and Slow) has so much value that I take the time to re-read it each year - maybe one day I'll be able to retain all of its content.

2 hours ago, PepeTheFrog said:

You might want to walk that one back a bit.

Why?  In a point scoring system where the amounts are transparent (assuming that is the technique used), wouldn't the difference/significance be readily apparent?

I'd like to hear your thoughts on the issue, but humans can't read frogs' minds so I'll need your assistance to understand your point.

Appreciate the feedback and the references Vern.  I don't intend to parse words here or inhibit the usage of the HTRFRP process, I'm quite excited by its prospects; however, I'm curious: should some consideration be given to the fact that those prior decisions were made in an environment where the Best Value Continuum was thought to consist of LPTA through Tradeoff? I think so, which is why I'm trying to understand the potential difference (if any) between something being a "significant factor" and something being "meaningfully considered."

I'm not trying to hit the brakes here and not embrace HTRFRP or other acquisition improvements...but I know others will so I'd like to discuss the issues surrounding developments like these as much as possible so I'm prepared with credible arguments to move us forward.  Apologies in advance if my relative youth or lack of experience is inhibiting the process.

EDIT (adding context):  I think I'm getting hung up by the following two paragraphs from the Sevatec decision (emphasis added):

Quote

Based on the facts before us, we find nothing improper about the agency’s price evaluation. As explained by the agency, this procurement does not involve a tradeoff and the agency’s price evaluation will consist of determining the fairness and reasonableness of multiple aspects of the highest rated offerors’ proposed rates. Those decisions cited by the protesters where our Office has found that considering only the reasonableness of an offeror’s price proposal is an insufficient consideration of price, involved post-award protests under solicitations that used tradeoff source selection processes, not present here.10 See e.g. Kathpal Techs., Inc.; Computer & Hi-Tech Mgmt., Inc., supra.

In a tradeoff source selection process, the agency cannot so minimize the impact of price as to make it merely a “nominal evaluation factor” because the essence of the tradeoff process is an evaluation of price in relation to the perceived benefits of an offeror’s proposal. FAR § 15.101-1(c). The solicitation here expressly states that there will be no tradeoffs in the source selection. RFP at 250. Source selection will be made based solely on a “highest technically rated [ ] with a fair and reasonable price” evaluation scheme, with no comparison of an offeror’s price relative to the benefits of the proposal. Id. The relatively low importance of price in an evaluation scheme that does not contemplate tradeoffs, as is the case here, is unobjectionable.

19 minutes ago, Gordon Shumway said:

No. It's just that the other factors are more important. Relative importance and the significance of a factor are two independent concepts.

I can agree with that as a permissible argument, but I don't think my previous argument is wholly without merit.  The definitions of significant (from The American Heritage Dictionary) are:

Quote

1.

a. Having or expressing a meaning: Are the markings on the stone significant?

b. Having or expressing a covert or nonverbal meaning; suggestive: a significant glance.

2. Having or likely to have a major effect; important: a significant change in the tax laws.

3. Fairly large in amount or quantity: significant casualties; no significant opposition.

4. Statistics Of or relating to observations or occurrences that are too closely correlated to be attributed to chance and therefore indicate a systematic relationship.

For definition #2, could one fashion evaluation factors whose relative importance resulted in cost or price not "having or likely to have a major effect" on the selection decision?  For definition #3, I think "amount of quantity" could speak directly to the relative importance of the various evaluation factors.

I will grant, however, that I need to go do some more reading on the cases where the GAO used the "significant factor" rule to fully understand their position on the issue.

Just for clarity's sake - CICA does not require price to be a significant factor, just a consideration (41 U.S. Code § 3306):

Quote

(c) Evaluation Factors.—

(1)In general.—In prescribing the evaluation factors to be included in each solicitation for competitive proposals, an executive agency shall—

(A) establish clearly the relative importance assigned to the evaluation factors and sub-factors, including the quality of the product or services to be provided (including technical capability, management capability, prior experience, and past performance of the offeror);

(B) include cost or price to the Federal Government as an evaluation factor that must be considered in the evaluation of proposals; and

(C) disclose to offerors whether all evaluation factors other than cost or price, when combined, are—

(i) significantly more important than cost or price;

(ii) approximately equal in importance to cost or price; or

(iii) significantly less important than cost or price.

Additionally, based on paragraph (c)(i), if other factors are significantly more important than cost or price, then wouldn't it follow that cost or price is not a significant factor in those circumstances?

13 minutes ago, Vern Edwards said:

I think substantial as used in FAR 15.403-1(c)(1) means nothing more than sufficiently influential to affect an offeror's pricing decision.

I like this interpretation/definition.

EDIT: Would the process identified in the solicitation for assessing the fairness and reasonableness of price be what influences offerors' pricing decisions?  Could/should one expect different results if the promulgated technique is comparison of proposed prices received in response to the solicitation versus a more detailed analysis as used by the GSA team?

Vern,

I'm just taking the information in front of me and analyzing it - I'm certainly not firm in my position, just trying to drive a discussion on the issue.  I find merit in your argument that disqualification could certainly meet the test of substantial; however, I quoted the court who decided the case in reaching my conclusion which I still think conflicts with the definition you provided.  Consider the juxtaposition between the two:

• Definition: "Considerable in importance" 
• GAO: "Relatively low importance of price..."

Can one have both "considerable" and "relatively low" at the same time?

As an aside, I don't tend to try to find the most restrictive interpretation - I also find value in determining the least restrictive, but a better exercise, and what I hope we're doing through this conversation/debate, is arriving at what is the most likely interpretation.

36 minutes ago, Vern Edwards said:

Matthew: I think you need to reread FAR 15.403-1(c)(1) and then explain to us why there was not adequate price competition.

Vern: I don't think the HTROFRP approach satisfies FAR 15.403-1(c)(1)(I)(A), particularly the requirement that "price is a substantial factor in source selection."  I think the consideration of price (which is what occurred in the HTROFRP approach to satisfy the CICA requirements) and price as a substantial factor in source selection are different.  The only substantial factor in source selection at play in HTROFRP is technical...I think those views are supported by the GAO's analysis regarding consideration of price on pg. 8 which states "The relatively low importance of price in an evaluation scheme that does not contemplate tradeoffs, as is the case here, is unobjectionable."

Maybe I'm wrong, I'm certainly always open to hearing other opinions on issues.  What are your thoughts Vern (and others)?

2 hours ago, FrankJon said:

Did the fact that GSA conducted a thorough cost/price analysis have any bearing on the outcome? What would have happened if GSA had instead conducted a simple price evaluation based on adequate competition?

From a theory standpoint, I don't think one can satisfy the requirement of "adequate price competition" in a HTROFRP (highest technically rated offeror with a fair and reasonable price) environment because offerors are not competing on price, they are competing on based on technical ratings.  I suspect the GSA contracting team understood this and showed considerable foresight in fashioning the fair and reasonable price evaluation methodology in the manner they did.

1 hour ago, Vern Edwards said:

Disagree. Disagree with extreme prejudice! The FAR councils should leave well enough alone. We've got too much regulation as it is. Professionals should read the decision and think. There is much more to be done. What was the method described in the Alliant 2 solicitation? What are the underlying principles of the GAO's decision? What adaptations and variations of HRRP (Highest Rated with Realistic Price) are legally permissible and practically appropriate for different source selections? We need more thought and experimentation.

Would you at least agree that some clarification of the Best Value Continuum is warranted (regardless of whether or not my proposed clarification was the right way to go about it or not)?

I'm surprised that this was the first time these procedures were used (or used and challenged) because, from an academic standpoint, Lowest Price Technically Acceptable (LPTA) and Highest Rated Technical Offer (HRTO) are the two, opposite ends of the best value continuum with Tradeoff occupying the space in between.  Nevertheless, after looking through educational materials currently available from DAU and other department sources, I see why: the Source Selection process that we're teaching the contracting community doesn't discuss HRTO (though I've yet to look at the CLCs).  See for example:

https://dap.dau.mil/acquipedia/Lists/Acquipedia Article/Attachments/3384/Best Value Continuum and Source Selection - June 30 2015.pdf

https://dap.dau.mil/acquipedia/Pages/ArticleDetails.aspx?aid=5201f734-3bce-4c5f-a5a3-47551df77ea5

I think it would be valuable for the FAR Council to update FAR 15.101 "Best Value Continuum" which currently only contains sub-sections for the Tradeoff Process (15.101-1) and LPTA (15.101-2) with a HRTO section (presumably 15.101-3) so that protests/challenges to the approach are less likely and so that acquisition professionals are more aware of the approach's existence and permissibility.  Thoughts?

4 minutes ago, Vern Edwards said:

Matthew:

The highest technically rated with a fair and reasonable price method makes good sense even when there will not be further competition for task orders.

Agreed.

The "highest technically rated [ ] with a fair and reasonable price" methodology makes a lot of sense for this situation and others like it where there will be further competition at the task order level.

Just wanted to post another book that I enjoyed reading: The Development of Modern Government Contract Law: A Personal Perspective by C. Stanley Dees.  The contents of the book can be found at the following link: https://lrus.wolterskluwer.com/store/products/development-modern-government-contract-law-personal-perspective-prod-10040886-0001/softcover-book-item-1-10040886-0001.  Each chapter is around 15-20 pages in length and the content is from the perspective of an industry contracts attorney.  I thought the book read smoothly and, while legally focused, is still an interesting read for contracting professionals.

j_dude77

The language you underlined permits more ratings than an overall or "rolled up" rating for each offeror.  While you state "each factor" in your post, that is not responsive to the OP's question.

Some might argue "a mere peppercorn will suffice" though I think appropriate/adequate consideration is a matter of business judgment. You might enjoy the following literature on the subject and for further research look up terms such as "peppercorn theory of consideration":

http://scholarship.law.wm.edu/cgi/viewcontent.cgi?article=2867&context=wmlr

Sound advice, as usual, from Vern. If you'd like the FAR citation regarding his analysis, refer to FAR 15.405(b) which states:

"The contracting officer’s primary concern is the overall price the Government will actually pay. The contracting officer’s objective is to negotiate a contract of a type and with a price providing the contractor the greatest incentive for efficient and economical performance. The negotiation of a contract type and a price are related and should be considered together with the issues of risk and uncertainty to the contractor and the Government. Therefore, the contracting officer should not become preoccupied with any single element and should balance the contract type, cost, and profit or fee negotiated to achieve a total result -- a price that is fair and reasonable to both the Government and the contractor."

Available to whom?

Vern,

Just out of curiousity, where is your definition from?

Don't assume just because the term was used in an RFP that it was proper - I second Retreadfed's recommendation.  Ask the drafter and reference the individual to the two definitions that the FAR actually contains while noting that the standalone term "commercially available" is not one of them.