Vern Edwards

@ji20874Thanks for the response. Just so you know, Delex, GAO B-400403, 2008 CPD § 181, addressed the question of whether the Rule of Two applied to fair opportunities under MATOCs. I think that's the question that 15 USC 644(r)(2) was written to answer, and I think the answer is no. But Delex did not address the question of whether the Rule of Two had to be applied before making the decision whether to use a MATOC, and I don't think 15 USC 644(r) does, either. I understand why people "support" the ITility decision. You're not the first person to tell me that. But the question that concerns me is whether GAO's decision correctly applies 15 USC 644(r) to the issue that was at hand. A side note: This is a discussion forum, and as a member, I am not willing to defer discussion of legal issues to attorneys. I'm not an attorney, but the Court of Federal Claims has referred to my writings on more than one occasion, as recently as March 2020 in fact. Educated laypersons can develop and express legal opinions (as opposed to advice) in forums like this; they just can't practice law. And I think practioners should work to become educated laypersons. I'd like to see more such discussion at Wifcon, especially with practitioners like you, instead of the querulous answering of indecipherable hit-and-run "questions." But I respect your position and your post. If you don't want to discuss it, you don't want to discuss it. I get it. As for fair opportunity ordering being "quicker and easier," it mostly is not. That ship sailed long ago. Agencies have turned the fair opportunity process into a FAR Part 15 process. They're even incorporating FAR 52.215-1 into their requests for task order proposals. I talked about that with a GSA official for an hour yesterday, and he was in near despair about it. The simplicity gene is rare among Federal acquisition practitioners. The FASA multiple-award policies have been a disaster in many ways.

@ji20874Do you see any incongruity between GAO's description of the protest and the basis for the decision they made? GAO seems to think that ITility protested the fact that the agency did not set aside the task order under the Alliant2 contract. See the first sentence of the decision. Why would ITility do that? They are not a party to the Alliant 2 contract. A set-aside under Alliant 2 would do them no good. It seems to me that ITility was protesting the agency's decision to use the Alliant 2 contract. GAO based its decision on its interpretation of 15 USC 644(r). But if ITility was protesting the use of Alliant 2, not the failure of the agency to set aside the task order under Alliant 2, then what bearing did 15 U.S.C. 644(r) have on the protest?

Not really. I believe they knew darned well from day one that they were going to proceed under the GWAC. Do you think the GAO got it right?

@C Culham 😊

@formerfed The court said that the agency did not formally cancel the GSA FSS solicitations as required by 10 USC 2305(b)(2) and did not formally withdraw the FSS set-asides as required by FAR 19.502-9. The court said that if it has, in fact, done those things it order the Army to reinstate the solicitations. The court told that Army that it could not proceed under the MATOC unless it does those two things anew.

From Government Contract Changes, by Nash and Feldman, 4:5: "A dramatic increase (or decrease) in the contract price also should be an indicator of a cardinal change. Indeed, this issue is frequently a key component for whether the change is out of scope, although it is not a conclusive consideration." Thus, while scope may involve more than price or total price, a change in price may well be a factor in determining whether there has been a change in scope. And thus, your assertions that "Scope is not determine[d] on math for form." and "Or in other words it has nothing to do with scope." are not correct. FPDS is not a "rule." A CO can determine a total contract or order "value" for purposes of FPDS reporting without stating such a value in a contract or order. And as far as I know nothing in the FPDS-NG User Manual requires that a contracting officer state a "total value" in a contract or an order. If you know of such a requirement, please cite it specifically. And where in FAR Subpart 4.10 does it state that a contract or order must state a total "value"? While every CLIN has a total, I've never heard of establishing a CLIN for something called "total value" or "amount." Did I miss it in FAR Subpart 4.10? COs account for obligations at the level of CLINs, not "total value." Well, it seems to me that if the purpose of stating "total task order value" is to account for even just some component of scope, it makes the policy shop's stance a reasonable one. Note again the Nash and Feldman reference, above. Look, Carl, I also think the policy shop is wrong. But I think it's wrong because "total value" is obviously the sum of the individual values that go into the total, which I presume are CLIN values. And, therefore, I think that when you change any CLIN amount common sense dictates that you should change the total amount. I think my belief is easily validated by looking at the forms used for orders, which I think are primarily DD Form 1155 and Optional Form 347. I don't think the policy shop's argument relating a stated "total task order value" to scope makes much sense, not because total value has no bearing on scope, as you so vehemently assert, but because if a scope-of-the-order issue arises the value of the order will be determined on more evidence than any stated value or amount on a form or elsewhere on an order document. Now, Carl, I can tell that you're upset about this thread (typos). So I don't want to provoke you further. I'll leave that to Joel. 😌 Easy does it, buckaroo. None of this matters. I've learned that.

Suppose that the government has a single-award IDIQ contract for services with a five-year ordering period and that the contractor is a large business. Suppose further that the minimum value has already been purchased and that the maximum value has not yet been reached. Now suppose that at the beginning of the fourth year of the ordering period the government has a new requirement for services that is within the scope of that contract and that is expected to exceed the simplified acquisition threshold, but that would not cause the IDIQ maximum to be exceeded. Three questions: Would the issuance of an order against the IDIQ contract constitute an "acquisition" as defined by FAR 2.101? Must the government make a "rule of two" determination in accordance with FAR 19.502-2(b) before issuing an order against that IDIQ contract? If your answer to Question 2 is yes, would your answer to be different if the IDIQ contract were with a small business contractor?

Has anyone read The Tolliver Group, Inc. and People, Technology and Processes, LLC v. U.S., 151 Fed.Cl. 70 (Nov. 30, 2020) and ITility, LLC, GAO B-419167, Dec. 23, 2020, which appear to conflict with respect to application of the "Rule of Two"— FAR 19.502-2(b) — when using a MATOC? The government has appealed the COFC decision to the Federal Circuit, and the result may have a significant impact on acquisition operations. Both decisions involve interpretations of 15 USC 644(r) as well as FAR 19.502-2(b). If you have read them (perhaps I should say, fought your way through them), what do you think of the two decisions and the apparently conflicting conclusions of the court and the GAO? What are the long term implications, if any? I'm trying to start a discussion thread, not an educational thread. If I don't get any responses within the next week or so I'll ask Bob to close it.

@C Culham On what basis, if not "math" and "form"? Why is policy wrong? What rule says that a task order must state a "total task order value," however measured? And if there is such a rule, what is the point? What information other than math is it supposed to communicate? Could it not have been intended to communicate "scope"? And why total task order "value" instead of amount? Is there some significance to the use of the word "value"? And yes, I read your post of Friday at 07.24.

Yes, it would have been nice. Maybe the responders should have asked some clear questions before responding. And maybe they should have ignored the inquiry if the OP did not provide timely and informative responses, instead of launching into the typical Wifcon Forum free-for-all.

He did no worse than most beginners. Better than many.

I think Milcon has left the building. When I read the opening question I wondered why there had to be a "total task order value." I assumed it was required by some form, such as DD 1155 or OF 347, otherwise it serves no obvious purpose. If the total task order value is needed to fill a space on one of those forms, then the answer to the opening question should be obvious. If the "total task order value" is the sum of the individual CLIN values, then if you change any CLIN "value" (i.e., amount) you change the total task order value, as well. In my opinion, that should have been the first and last response to Milcon.

@joel hoffman I don't understand your last post.

This was the opening post: The very first response to that should have been: If the "total task order value" is the sum of the values of the individual order line items, then a change that reduces the value of any of the order line items should result in a commensurate reduction to the "total task order value." Period. However, an amusing addition to that would have been, Duh.

Milcon is asking whether it makes sense to change the "total task order value" in light of the fact that the deobligation of funds associated with the travel CLIN does not reflect a change in the scope of the order. In order to answer that question, those of you who have chosen to respond to Milcon should ask yourselves: What, if anything, is the (1) contractual and (2) administrative significance of the "total task order value"? The answers to those questions depend in part on the location and context of "total task order value" in the task order. Maybe "total task order value" is just an entry on a form, with no contractual or administrative significance whatsoever, and Milcon should just go along with his policy shop's program. Maybe it's just a product of simple arithmetic. Or maybe Milcon's question is just a bureaucratic mystery, like the proper entry in SF 30, Block 13C.

@Milcon I haven't seen any mention of this, and I may have missed it, but I'm wondering where in the order the "total task order value" appears. Some questions: Was the order issued under DD Form 1155 or Optional Form 347? Some other form? If DD 1155, are you talking about the amount that goes in box 25? If OF 347, are you talking about the amount that goes in box 17(h)? If neither form, where does the "total task order value" appear? Is the "total task order value" the sum of (1) the firm-fixed price (for performance) and (2) the estimated cost of travel?

I don't know what you mean by "receiving/accepting," but see FAR 7.503, Policy [about contractor performance of inherently governmental functions] If "receiving/accepting invoices" entails more than routine invoice receipt and examination, then you should describe the work.

here_2_help has already recommended training. I suggest that you buy a copy of Cost-Reimbursement Contracting, 4th ed., by Cibinic and Nash (2014), published by Wolters Kluwer. It's pricey, but worth it if you really want to understand the concepts and principles that apply in cost-reimbursement contracting. It's slightly out of date on some of the regulations, mainly with regard to the cost principles, but it's excellent on ideas and practices. Very detailed.

It should be made clear that the 70 percent referred to in the above posts is not some limit on the amount of work that a prime or subcontractor can award to subcontractors and sub-subcontracts. It is the percentage of subcontract effort under a prime contract or subcontract at which "pass-through charges" must be reported to the contracting officer.

Emphasis on "expressly" added. Go to www.acquisition.gov and download the entire FAR in pdf format. Then open Adobe Acrobat Reader and search for "other direct costs" and "ODC" in full search. Then see if any of the references mention any limitation on the percentage of ODC that a prime can "give" to a sub. Takes less than five minutes. Easy peasy. FYI, the phrase "other direct costs" appears in FAR only nine times. I didn't search the FAR supplements. I figure you can do that for yourself.

@Bill Elliott Bill, just some thoughts. First, the best reference to the SBA Final Rule is 85 FR 66146, 66180, October 16, 2020, amending 13 CFR 121.103(h)(4), "Facility Security Clearances." Second, here is what I suspect: SBA changed its own rules with respect to facility clearances for joint ventures, but that might not cut any ice with DOD, which has its own rules. (I doubt that SBA can dictate to DOD when it comes to industrial security.) Even assuming that DOD is open to changing, it would first go through the Federal Register process of changing the rules in 32 CFR § 117.9, "Entity eligibility determination for access to classified information," paragraph (k), "Joint ventures." It may be that since the SBA change happened just last October, DOD has not gotten around to considering whether to change its own rules. The Defense Security Service and the contracting officer will be bound by the existing DOD rules and couldn't care less about SBA's rules. In other words, the SBA change may not do anything for you. This is all speculation on my part.

I am not aware of any governmentwide rule. FAR is silent on the matter. I presume it is a matter of agency or local policy. You may have to solicit offers in order to fulfill an annual requirement before funds are appropriated.

@DWGerard1102 Thanks, DW. Interesting perspective and ideas.

@C CulhamThanks, Carl. I don't think GAO has ever ruled on the question of whether application of Part 15 procedures to fair opportunities under 16.505(b) via 52.215-1 is a FAR deviation requiring approval. GAO has said that Part 15 does not govern, but has acknowledged in at least 27 decisions that agencies apply it, and they say they will enforce such applications. I don't think the application of Part 15 to fair opportunities has ever been challenged, and I believe that GAO is unlikely to take up the issue sua sponte. Have I missed a decision? The one you cite doesn't address the issue I have raised.

@DWGerard1102 I'm surprised that COs don't stipulate an amount against which all competitors must plan. Do you know of any who do that?