Matthew Fleharty

2 hours ago, DTMD said:

I think the "muddiness" I expressed is exactly because I can't find anything that says either way solidly.

Sure you can, you're just conflating two concepts.  The issue of "obligation" is separate from "funding" (full funding versus incrementally funding).

Obligating the Government is to bind the Government to that contract action (i.e. executing an order for the minimum purchase amount) - see definition of "obligate" (https://ahdictionary.com/word/search.html?q=obligate)

When/how the Government obligates itself is when the issue of funding comes into play - you have two situations that may arise per FAR 32.703-1: full funding or incremental funding (I say may, because as Vern pointed out, some contracts cannot be incrementally funded).  As long as you meet your agency's requirement(s) for incremental funding you may do so.

The two are often conflated/married together because the Anti-Deficiency Act  (http://www.gao.gov/legal/anti-deficiency-act/about) prohibits:

• "making or authorizing an expenditure from, or creating or authorizing an obligation under, any appropriation or fund in excess of the amount available in the appropriation or fund unless authorized by law. 31 U.S.C. § 1341(a)(1)(A).
• involving the government in any obligation to pay money before funds have been appropriated for that purpose, unless otherwise allowed by law. 31 U.S.C. § 1341(a)(1)(B).
• accepting voluntary services for the United States, or employing personal services not authorized by law, except in cases of emergency involving the safety of human life or the protection of property. 31 U.S.C. § 1342.
• making obligations or expenditures in excess of an apportionment or reapportionment, or in excess of the amount permitted by agency regulations. 31 U.S.C. § 1517(a)."

See how the terms "obligation" and "funds" come up together consistently, yet also notice how they are separate (this is, in fact, how violations of the ADA occur...obligations without funds, for example).

Now reread that excerpt you provided - it says nothing about a requirement for full funding.  Maybe some other regulation applicable to your agency does, but the one you quoted, in my opinion, does not prohibit incremental funding of task orders for the minimum order under an IDIQ as long as you cover the minimum.

4 hours ago, Jamaal Valentine said:

Is there an authoritative definition for considered?

Jamaal,

I wish there was a FAR definition for "fair opportunity to be considered for..." but there isn't.  Under the common definition though (https://ahdictionary.com/word/search.html?q=consider&submit.x=46&submit.y=26), I think a contracting officer would be unable to "consider" a contractor for an order if the contractor has reached the ceiling of their contract.

46 minutes ago, joel hoffman said:

It would seem that you would have a defacto single source or "single award" scenario if one of the two multiple awardees reaches a hard ceiling order limitation that would contractually prevent making additional orders to that firm. You would definitely want to have ordering procedures which would allow a negotiated task order process. The government wouldn't have to award a task order at an unreasonably high price that would otherwise be competitive in the market. 

Surely there are readers here that have experienced a similar scenario where some or all other of the pool members have reached the ceiling limitation. What say ye? 

Joel, the ordering procedures might provide more specifics, but I don't know that they would/could change the nature of the situation because any ordering procedures for a multiple award contract must comply with FAR 16.505(b).  

From what I've read, I don't believe and cannot find anything stating that a multiple award contract can become a single award IDIQ when only one contractor has ceiling remaining.

On July 19, 2016 at 6:17 AM, EHorner said:

Can we continue to use Vendor B's contract and basically treat it as a single award ID/IQ? Since none of the exceptions to fair opportunity in FAR 16.505(b)(2) apply, what documentation should be written to justify the continued use of Vendor B's contract?

For multiple award contracts, FAR 16.505(b)(1)(i) requires that contracting officers to provide each awardee fair opportunity to be considered for each order exceeding $3,500 (unless exempted by FAR 16.505(b) - to which you point out is not applicable) and FAR 16.505(b)(1)(iii) requires orders in excess of the SAT be placed on a competitive basis.  I'd argue that the fact that a contractor has reached their ceiling does not relieve the contracting officer of the requirements of FAR 16.505(b)(1)(i) & FAR 16.505(b)(1)(iii), it just makes the requirements impossible to fulfill (because a contractor that has reached their ceiling cannot be fairly considered for the award of any more orders).  If the preceding analysis is correct, it would be improper to just use Vendor B's contract and treat it as a single award ID/IQ.

Does anyone else have any thoughts on this issue?

22 minutes ago, jonmjohnson said:

I would like to see people who want to see things do things.  If you want to see it...do it.  Prove or disprove the premise of the argument.  I am not intentionally being a jerk Matt, but I am guessing you are in a command where you are having people act on your behalf.  You may be right, and if it is something that you are willing to undertake (rather than request) I would welcome it.  Forget about strengthening a case, either make the case or disprove the case. 

I was thinking about this and my car.  When I bring my car to get something fixed someone under the age of 40 will inevitably tell me they have to do a diagnostic to fix the problem ($90 charge).  I refuse and then find the oldest mechanic in the room, ask him what he thinks the problem is, and he tells me without the need for analysis (and usually offers the lowest possible cost to fix the problem).  He goes by what he hears from the engine, what he knows through years of experience, and what he observes from other less senior mechanics.  The younger mechanic will want proof via analytics thinking that they will validate their approach.  The older mechanic only engages in the analytics if it saves time and money, or when he wants to prove to the younger mechanic that he knows exactly what he is talking about.

Congress would certainly agree with you in that to support the claim they will want more robust metrics and analysis.  What Vern had closed with was this "If you are a GS-1102 with a long time to serve until retirement, you cannot be neutral about this. This is your career that I’m talking about."  If you are not neutral, then pick up the torch and carry it.

 

I did not state that I thought Vern was wrong or that the data would disprove his point, quite the opposite in fact.  I was making the point you referred to in order to crowd source research ideas to further explore the issue because, while I'm not "in a command where have people act[ing] on [my] behalf," I do have contacts and former professors back at the Naval Postgraduate School that get new students every 1.5 years that are looking for research/thesis topics - this would be something that those individuals have the time, energy, and resources to research and write on.

So thanks for commenting on the merits of what further research might or might not be beneficial on this issue and not assuming I'm already some lazy, dejected contracting professional that just wants to complain...

I don't think everyone has access to it (which now requires NCMA membership) - hence the request for the author to share so everyone can read it and then intelligently discuss.

For those that have read the article (and the author), I think the portion of the argument that could be improved on with data is when Vern argues that "the government's contracting workforce does not reflect the contracting workload and the government's actual needs."  I would like to see an analysis of the Governments' contract actions through FPDS-NG data identifying those non-complex actions that could be performed by 1105s and 1106s versus the number of actions that might require an 1102.  Such an analysis (if performed correctly) could go a long ways towards strengthening the argument that a certain labor mix is needed within the 110X workforce.

41 minutes ago, PepeTheFrog said:

Great timing-- re the workforce reforms discussion: Over the weekend, PepeTheFrog saw that Vern Edwards' article "Out of Balance—Careers in the Federal Contracting Workforce: Urgent Reform Required" was published in the August edition of National Contract Management Association's Contract Management magazine.

http://www.ncmahq.org/stay-informed/contract-management-magazine

I read the same - Vern would you be open to sharing the article on the forums with all on a separate thread to start/have a discussion regarding your remarks?

On ‎8‎/‎3‎/‎2016 at 2:05 PM, David Bodner said:

So, fewer evaluation criteria.  I'm on-board with that.  Unfortunately, I've had very little success in convincing my customers of that.  That may not be one person's stupidity as much as cultural inertia.

I don't think Vern is arguing for "fewer evaluation criteria," but rather evaluation criteria that are actually discriminators (whether that means agency's utilize more or less - depending on the situation).

Apsofacto,

It's not just the mandatory use or not (that's a different discussion which I'm happy to have - I'd sum my general position up as if you build a good strategic sourcing vehicle, the users should come) - the concern I was trying to get across in my previous post is that when the Government looks at category management we only ask ourselves "can we strategically source this?" (mandatory or non-mandatory) and, if not, the conversation ends there.  There are other ways to manage categories of spend in addition to strategic sourcing, but the Government does not seem to be doing anything else.

I find it interesting that every time the topic of "category management" comes up, inevitably the discussion pivots to "strategic sourcing."  Even in the Air Force, as far as I am aware, our conversation regarding category management merely tracks/assesses categories with high spend and then asks the question "can/should we strategically source products/services for this category?"  If yes, we do and create some sort of mandatory use contracting vehicle, if not, we move on to the next category and repeat the assessment process.

The problem I have with the previous approach is that "category management" is not simply a question or strategic sourcing or not, but rather what are the best practices for acquiring the products/services within a category (which may very well be aggregation through strategic sourcing) and then disseminating those approaches to the contracting professionals and their customers.

Maybe I'm mischaracterizing what the Air Force/rest of the Government is doing today (I've been in systems for almost two years now so that may very well be the case), but from the conversation I saw in the panel discussion here, I think the trend is still merely looking at categories for strategic sourcing opportunities and not much else.

46 minutes ago, Vern Edwards said:

Matthew, when in doubt, read the contract. Navy's approach is not wrong because it would eliminate risk. It is wrong because it is inconsistent with the language of the price adjustment clause. Here are the key paragraphs from FAR 52.222-43, the price adjustment clause. Note the bold/italicized words.

Apologies for drawing you back into this conversation - you and I agree on what the clause states and the process/formula for calculating adjustments.  I suppose my "elimination of risk" argument was related to why the price adjustment requirement was established/exists (i.e. price adjustments are based solely on actual wage increases stipulated by the DoL so that contractors don't have to price in estimates of potential increases or decreases that may or may not occur at magnitudes that may or may not be accurate).  Is that a fair assessment of the policy?

Congrats and thank you for being a fine steward of taxpayers' dollars.

More importantly, make sure you pass your lesson(s) on to the rest of your colleagues.

22 minutes ago, Navy_Contracting_4 said:

You fail to understand that that's precisely what this method does.  It dopes merely "remove the Government mandated wage minimums (to the extent that they actually impact the contract) from the risk equation."  It definitely does NOT "remove all effort (hour) risk from the contractor."  It does NOT price in year to year adjustments to hours.  In my example, pricing in a year to year adjustment to hours would result in adjusting the price to $23,100, but the method I describe results in an adjustment to only $21,100.

I see that - I was incorrect in stating "all effort (hour) risk;" however, I'm still of the position that no effort (hour) impacts should be taken into consideration even if it is just a portion of those impacts multiplied by the actual wage differences.  Seems we'll just have to agree to disagree.

34 minutes ago, boricua said:

Hello Matthew Fleharty,

Services tend to be complicated enough that negotiations are necessary.  I will grant you that "Programming" might ask for something else other than IT services.

Thanks for the comment.

The OP does not say the services are programming services, he just states they are "commercial services" and later calls the requirement a "project."

"Programming" is the entity with the money (i.e. the customer/program office...) - re-read the sentence and see if we agree or not:

On ‎7‎/‎29‎/‎2016 at 5:38 AM, Maquoketa said:

Programming only has $950,000 available for this project.

2 hours ago, Vern Edwards said:

In any process that is not sealed bidding, competition sets conditions for pricing, but never determines price.

I like the succinctness of that explanation - very well put (as usual).

H2H,

Understood - on your next major commercial purchase, I'd still be happy to help you overcome any bias that may remain and I'll even revise my position to let you keep the difference

7 hours ago, here_2_help said:

Matthew your analogy is inapt. If I get a quote from a dealer on a new Ferrari and it's outside my price range, I'm not going to expect the Ferrari dealer to meet my budget. Instead, I'm not going to buy a new Ferrari because the price is outside of my budget.

Let me offer my analogy:

Next time I go to my auto mechanic and he tells me it will cost $500 for the repairs, I will either accept his quote or go find another auto repairman. I will not attempt to negotiate him down. The commercial price is the price.

And if I get 4 quotes from 4 auto mechanics for the same repair and they are all in the same range, I will either accept the lowest quote or not get my repairs done. I will not go back to the lowest price mechanic and tell him he can have my business if he can shave off 10%.

In summary:

There is no purpose in getting commercial item competition if you're going to ignore the pricing information provided by the commercial marketplace. If you're going to ignore that information, why not just go sole-source and negotiate a price? Why pretend the competition is a valid means of determining price reasonableness?

Please don't consider negotiation and competition mutually exclusive - they're not and, in fact, buyers are better off (personally and professionally) if they leverage both together rather than either independently/separately.

I don't understand how my analogy is inapt or any different than yours - in both of those cases (and in many others) I would take the opportunity to bargain for a better price.  For example, when buying a car or obtaining repairs from a dealership, a common metric that is used for employee bonuses these days is "customer satisfaction" (since wholesale/invoice prices are pretty easy to find through market research these days) - knowing that, I've been able to leverage (multiple times) additional discounts on the lowest quoted price in exchange for those maximum ratings (after all, my satisfaction is a function of receiving a quality product/service at a low price).  Try it next time you go to buy a car...or if you're ethically opposed to doing so, I'll gladly negotiate your next vehicle in exchange for keeping the difference between the lowest quoted price you receive and the amount I settle at.

Finally, I think Vern's comment regarding the concept of price reasonableness is spot on - a fair and reasonable price is not a price point, but rather a range of prices.  If you disagree, just consider how transactions in markets would have to occur if the converse were true...

Deleted - Accidental Duplicate Post

On July 14, 2016 at 3:17 PM, Navy_Contracting_4 said:

Maintaining the contractor's profit/loss position is not a principle I espouse.  It was merely an observation I made to counter people's possible objection that my adjustment method might somehow help the contractor get some kind of windfall.

Your adjustment method based on hours is inappropriate because pricing in year to year adjustments to hours would remove all effort (hour) risk from the contractor - that's certainly not what the parties sign up to when they execute FFP service contracts.

The adjustment is not designed to maintain profit/loss positions year to year, but rather to remove Government mandated wage minimums (to the extent that they actual impact the contract) from the risk equation.  

7 hours ago, jdm843 said:

The contractor's REA also cites 52.243-1: "IAW FAR 52.243-1 Changes, I respectfully submit a request for equitable adjustment based upon the impact of the contract changes realized since inception of the contract."

Is FAR 52.243-1 even in your contract?  As it has already been stated, for commercial contracts, it shouldn't be.

8 hours ago, jdm843 said:

Yes, all the modifications were "supplemental agreement" (SF30 box 13c).  See naivete discussion above.  I'd argue that the Government had some culpable naivete at this point as well.

Sounds like the contractor realizes he/she made a bad deal (but a contractually binding deal with consideration nevertheless) and now he/she wants the new PCO to Monday Morning Quarterback the issue.  Have you spoken to the previous PCO and has it occurred that he/she may have known exactly what he/she was doing when the previous modifications were signed?  Even with all these letters and tertiary documentation you point to, there were multiple opportunities for this contractor to price into the contract modifications whatever consideration should have been adequate for the change and he/she failed to do so (or do so accurately) - OR they did price them in accurately and now the contractor is trying to extract even more from the new PCO...

2 hours ago, here_2_help said:

Open competition in the commercial marketplace has determined the price. The available budget is insufficient. Either cancel the requirement or get more money.

In my view the entire purpose of going to the marketplace to acquire commercial services is to provide assurance that the price is fair and reasonable. In this case there is no question about that. Trying to "negotiate" undercuts the entire philosophy of commercial item acquisitions.

I'm just saying.

I couldn't disagree more. Next time you go by a car will you be accepting the lowest quoted price of the vehicle or will you bargain?

6 hours ago, boricua said:

Acquisition Method - I would not have worked a million dollar IT services project as an RFQ, I would have used a RFP (FAR Part 15).

Why?  I don't understand this desire to automatically jump to utilizing FAR Part 15 procedures when, for commercial items, the authority in FAR 13.5 exists.  How was using an RFQ the cause of this situation and what in FAR Part 13 prohibits the OP from resolving it?

Also the OP never states that these are IT services...the post states "commercial services."

On July 26, 2016 at 2:58 PM, SubK said:

My guess is that the clause also states  Any order issued during the effective period of this contract and not completed within that period shall be completed by the Contractor within the time specified in the order.

Your guess?  Why not determine what the situation actually is (unless you don't want relevant input)...

1 hour ago, baierle said:

At my federal agency, we will not award a contract to a vendor not registered and current in SAM, and their SAM record must show the NAICS/size for the pending procurement.  This is regardless of set aside or no set aside, and regardless of appropriated or non appropriated funding.

Now, under most circumstances, I notify vendor and allow time for them to input a specific missing NAICS.

EB

 

I understand the requirement for current registration in SAM, but where does your agency's requirement for a particular NAICS code listing come from?

37 minutes ago, thecontractingguy said:

Must a vendor have a NAICS code listed in SAM in order to receive a federal contract?

Apologies in advance for answering your question with questions, but have you thought about the purpose and function of NAICS codes (specifically in relation to federal contracting)?  Also, where would you find information that explains why a prospective contractor may not be able to receive a federal contract and is there a NAICS requirement there?

5 hours ago, styrene said:

Thoughts?  . Anyone here actually "scoring" Past Performance instead of using it as a risk indicator? 

Happens quite often - there are even some best value source selections where past performance is the only factor trading off with price - research the term "Past Performance Tradeoff" and look here: www.farsite.hill.af.mil/archive/affars/2009-0803/IG5315.101-1.doc (Disclaimer: this IG is archived and no longer part of the AFFARS)

Also, if you're uncomfortable with the data in PPIRS, maybe you should consider other means of assessing past performance.  I'm not sure what types of contracts you work on, but as an example, if you're contracting for commercial services you could consider using past performance surveys of contractors' performance in the commercial sector as well.

5 hours ago, styrene said:

Knowing that the quality of the past performance data in PPIRS is by no means standard, I would find it difficult at best to downgrade vendors who received less than an excellent rating, and I think I would have a hard time supporting that evaluation score if the vendor protests.

Is anything subjective standard?