Vern Edwards

DOD operates in a special acquisition environment because of the amount of money it spends. That's why Congress is obsessed with DOD acquisition and enacts so many Title VIII laws every year. That's why the goal of a single governmentwide procurement regulation has not been achieved. The FAR is 1,996 pages long in its pdf edition. The DFARS is 1,336 pages long, and that doesn't include all the class deviations and policies like the 60-page DOD source selection procedures. Absurd. The regulators need to let DOD have its own regulation and apply the FAR to just the civilian agencies.

Who knows? I doubt that there is any readily accessible record of any deliberations that may have occurred in Congress, OFPP, the FAR Councils, or elsewhere. A lot of FAR clauses are excluded from contracts for commercial items, but not enough. Why "Yay"? They only did what the law required. They didn't act out of special DOD moral or ethical righteousness.

See DFARS 212.301(f)(1)(A), which requires inclusion of the gratuities clause in DOD solicitations and contracts for commercial items "to comply with 10 USC 2207," a law that applies only to the Department of Defense and that has to do with limitations on expenditure of appropriations. That is consistent with FAR 12.301(f), which states: A check of the FAR system shows that no other agency has applied the gratuities clause to contracts for commercial items.

The prescription in FAR 3.202 is irrelevant pursuant to FAR 12.301(d). If you're buying commercial items you shouldn't be reading FAR 3.202, because of FAR 12.301(d). The history of FAR 3.202 is also irrelevant pursuant to FAR 12.301(d). There is nothing new about this. The statute that introduced commercial items policy was enacted in 1994. FAR Part 12 dates from slightly later. It's now 2021. Time to get with the program.

FAR 12.301 (a), (b), and (c) prescribe the provisions and clauses that apply to contracts for commercial items. FAR 12.301(d) says: "Other required provisions and clauses. Notwithstanding prescriptions contained elsewhere in the FAR, when acquiring commercial items, contracting officers shall be required to use only those provisions and clauses prescribed in this part." Emphasis added. What about that is hard to understand? We've now been buying commercial items pursuant to FAR Part 12 since the mid-1990s, more than 20 years. There is no issue about the gratuities clause. It does not apply. It does not apply because it is not prescribed in FAR Part 12. There is no "disconnect" in this case, only cognitive dissonance. I might understand the opening post if this were the For Beginners Only forum, but it's not.

And, to complete Jamaal's thought:

The cost/price analyst should simply report "my findings and recommendations." Should analysts state that they "find" that the price is fair and reasonable? Let them, if that is their opinion. So what? See FAR 15.405(a): If you agree with the analyst, you can cite their finding. If you don't agree with the analyst and seek a lower price, who is going to blame you?

@Neurotic Warning: I have been thinking about writing what follows for a long time, but it may be more than you care to know. Keep that in mind if you decide to read it, and don't think me or accuse me of being pedantic if you read it and don't like it. (Not that you would, but some probably will.) Do not complain, all ye who proceed from here. "Fair and reasonable price" is an old phrase. I searched the Congressional Serial Set and found that what appears to have been its first official use was in an 1834 Senate debate about the purchase of printing services for Congress. It is an example of what linguists call "synonymy in idiomatic expression," which includes phrases like "plain and simple." An idiom is common speech, defined in Chambers Dictionary, 13th ed., as "A group of words established by usage as having a meaning not deducible from those of the individual words (e.g., rain cats and dogs , see the light )." Bryan Garner calls such idiomatic expressions "doublets." See Garner's Dictionary of Legal Usage, 3d. ed., "Doublets, Triplets, and Synonym-Strings." Garner includes a long list of examples, such as: aid and abet, all and sundry, any and all, each and every, fit and proper, free and clear, indemnify and hold harmless, null and void, part and parcel, separate and distinct, terms and conditions, will and testament. Such phrases are examples of "synonymy in idiomatic expression." They include two words that mean the same thing---synonyms. In our field we speak of "fair and reasonable prices" and "reasonable costs." "Fair and reasonable price" is an example of a synonymous idiomatic expression. "Fair" and "reasonable" do not denote distinct attributes. "Fair and reasonable price" it is simply a synonymously idiomatic way of saying "fair price" or "reasonable price," that is, an amount that we should be willing to pay without fear of being called fools. The doublet is used for emphasis. Acquisition law, regulation, and policy have adopted the idiom, but have not defined or set specific and distinct standards for "fair price" and for "reasonable price." Another such expression is "full and open competition." There are no distinct standards and definitions for "full competition" and for "open competition." On the other hand, "reasonable" as in the phrases "reasonable cost" and "cost reasonableness", refers to a specific standard prescribed by FAR 31.201-3. In short, "fair and reasonable price" does not mean anything specific. It is the undefined label for a very fuzzy goal. But "reasonable cost" is specific, more or less, with wiggle room. Short answer to your question: No. [Cost] reasonableness and "fair and reasonable" price are not the same. You probably knew all this, but I have had so many questions about "fair and reasonable" over the years that I just had to get this off my chest. Forgive me.

@Randy322 I'm sorry that no one has responded to your request. Any response would likely be speculative, and it is hard to speculate intelligently without knowing: the position (job) description, the organization and office that is seeking to fill the position, your personal background, and how much time you have to prepare for the interview. I'm sure everyone wishes you well.

Here is FAR 15.304(c)(1)(ii): In light of the definition of qualifying offeror in FAR 2.101, that means an agency need not evaluate price if it will award a contract to every responsible offeror who submits a technically acceptable proposal and is likely to offer fair and reasonable prices. Responsibility is a pass/fail criterion. Likely to offer fair and reasonable prices also seems to be a pass/fail criterion (but maybe not--perhaps some offerors could be more likely than others--absolutely, highly, moderately, etc. Can we include only they highly likely?) So what about technical acceptability? Can that be a matter of comparisons and tradeoffs or is it necessarily pass/fail? Congress and the FAR councils should get together and form a slapstick comedy troupe.

Since the regulation does not define "technically acceptable," smart contracting officers will define it in the solicitation. That should put the issue to bed. The definition should state that in order to be technically acceptable a proposal must, among other things, conform to all material terms of the solicitation. That's the GAO/COFC standard for acceptability and always applies. The CO can add anything else he or she wishes in order to make the term more narrowly restrictive. The CO should document the rationale for the definition and ensure that it is not unduly restrictive. Putting the definition in the solicitation would mean that prospective offerors must protest it before the proposal due date or forever hold their peace.

@GovtAcctGeek The definition of service employee is not circular. It only seems that way to you because you have not completed your research. While complicated, it is quite clear once you sort out the complications. You must do that through legal research. "Service employee" is defined at 29 CFR 4.113(b) as follows: Thus, a service employee is any employee who is not a bona fide executive, administrative, or professional employee, as defined in 29 CFR Part 541, and who is working under a contract that is covered by the Service Contract Act of 1965. Research will show that contract coverage is prescribed by 29 CFR Subpart C. As has been pointed out to you, research will confirm that while many service employees are traditional "blue collar" works, some are not. The Department of Labor does not consider police officers, detectives, deputy sheriffs, state troopers, highway patrol officers, investigators, or fire fighters to be "blue collar," but also does not consider them to be executive, administrative, or professional workers. So, if you want to know whether the micro-purchase threshold is $10,000 or $2,500 for a particular acquisition you must study (1) 29 CFR Subpart C in conjunction with (2) the definition of "service employee" as set forth in 29 CFR 4.113(b) and 29 CFR Part 541. Nobody said learning such complicated stuff would be easy, but that's why the government needs contract specialists.

Of course. Because the CO needs cost or pricing data in order to prepare for negotiation. Why the heck would a CO negotiate to agreement first and then ask for certified cost or pricing data? In order to revisit the negotiation?

According to FAR 15.402(a)(1), contracting officers "Shall obtain certified cost or pricing data when required by 15.403-4, along with data other than certified cost or pricing data as necessary to establish a fair and reasonable price[.]" Emphasis added. Congress felt that COs would need accurate, complete and current cost or pricing data (C/PD) in order to determine whether a proposed cost or price is fair and reasonable when adequate price competition is not present or when prices are not set by law or regulation. That purpose is very well documented in hearings leading to enactment of Pub. L. 87-653. The statute does not require contractors to submit cost or pricing data. it requires agency heads to require contractors to submit it under specified circumstances. There is a dollar threshold for submission, but there is no dollar threshold for certification. Both statute and regulation state that when a CO requires submission of cost or pricing data he or she must require certification, unless one of the exceptions (listed in FAR 15.403-1) is found to apply. They say nothing about the effect of negotiated price on certification.

@joel hoffmanYou don't have to "yield" and agree to anything. I wasn't arguing with you. I'm involved in a running debate with two colleagues and thought I'd share one of the points of view. I haven't taken a position against anything you've said. At least, I don't think I have. My back and forth with my colleagues is a reflection of the utter incompetence of the people who wrote the FAR implementation of what used to be called the "Truth in Negotiations Act" and is now called something else. (I won't say what it's called. It's bad karma to write or speak it.) They mucked up the requirements of the law, and the three of us are trying to sort it out. I thought I'd share one of the takes. We haven't settled yet. A very old friend of mine was on one of the two FAR councils before she retired. One day some years ago we met for lunch in Crystal City. She was at the restaurant when I arrived, and before I could even say hello she said, "There aren't two people on those councils who can write a decent English sentence." The FAR coverage of cost or pricing data, certification, and defective pricing is the proof or her assertion. Any close reading of the defective pricing clause at FAR 52.215-10 by a literate person would be enough to give them fits.

Here's an argument based on the scenario that I described above: MAJOR PREMISE: 10 USC 2306a(a)(2) states: "A person required, as an offeror, contractor, or subcontractor, to submit cost or pricing data under paragraph (1) (or required by the head of the agency concerned to submit such data under subsection (c)) shall be required to certify that, to the best of the person's knowledge and belief, the cost or pricing data submitted are accurate, complete, and current." See also FAR 15.406-2(a): "When certified cost or pricing data are required, the contracting officer shall require the contractor to execute a Certificate of Current Cost or Pricing Data, using the format in this paragraph, and must include the executed certificate in the contract file." MINOR PREMISE: The contracting officer required the offeror to submit certified cost or pricing data in accordance with 10 USC 2306a(a)(1)(A) and FAR 15.403-4(a)(1). CONCLUSION: Therefore, the contracting officer must require the offeror to certify the cost or pricing data.

Ah, "deduce." A friendly request: Since you can deduce, please show us your deduction: major premise, minor premise, and conclusion. I ask because I'm having an argument about this with some colleagues right now, and I'm hoping you can help me out. It's two against one, I'm the one, and the two colleagues are distinguished professionals. A contracting officer reasonably expected a proposal to come in at more than $2 million. None of the exceptions applied, so she required the submission of certified cost or pricing data. The offeror complied, but did not submit a certification, saying it would certify upon reaching price agreement. The offeror proposed a price of $2,237,561. The parties negotiated for a couple of weeks and reached agreement on a price just below $2 million. The CO relied on the cost or pricing data that were submitted and, in compliance with FAR 15.406-2(a), asked the contractor to certify. The contractor balked, saying that since the price was below the threshold for submission it shouldn't have to certify. The contracting officer insists that the contractor certify. Who's right? 🤔

I presume that "not for performance" means that the line item does not identify a separately deliverable item of service or supply. If so, then since October 1, 2019 it has been improper to establish a line item that does not identify a separately deliverable supply or service. See FAR 4.1000 and 4.1003. If your contract was written before Oct. 1, 2019, when people often established CLINs for things such as travel costs, then it may be that the intent of the "option" was to authorize and track travel associated with a funded CLIN, in which case you should talk to your accounting and finance office. You may not need additional funds. If your contract were being written today, and if you wanted to establish a mechanism for authorizing and tracking something like travel costs, then I think you could establish an "informational subline item" under a funded line item for that purpose. See FAR 4.1004, especially (b)(1). If you did that, and if the funded line item included funds for the travel, then you would not need funds for the informational subline item.

I cannot answer your question.

By "Traditional Guardsman" do you mean a member of the National Guard?

@Gov Researcher Is this your question: When contracting officers report that they obtained cost or pricing data, may I assume that the contractors certified the data?

The deepest, most wide-ranging, and most reliable source of information about certified cost or pricing data is Defective Pricing Handbook, 2019-2020 Edition, by David Z. Bodenheimer, a Washington D.C. "super lawyer" and partner at Nichols Liu. The book is published by Thomson Reuters. It is the go-to book on all aspects of certified cost or pricing data and defective pricing. It does not, however, address FPDS coding. David and Stan Johnson litigated what was at the time the biggest defective pricing case ($300 million) in the history of The Truth in Negotiations Act, Pub.L. 87-653 (1962), Wynne v. United Technologies Corp., 463 F.3d 1261 (Fed. Cir. 2006). The court's decision settled a major precedent.

How would you use only FAR 12 and 16.504 to award a contract? See FAR 12.203, Procedures for solicitation, evaluation, and award: FAR Part 12 is not stand-alone.

Note that FAR 15.403-4(c) states: "If certified cost or pricing data are requested and submitted by an offeror, but an exception is later found to apply, the data must not be considered certified cost or pricing data as defined in 2.101 and must not be certified in accordance with 15.406-2." So it's possible that "certified cost or pricing data" were requested and submitted, but either were not certified or were inappropriately certified and thus the certified cost or pricing data were not "certified cost or pricing data" after all. However, does the rule at 15.403-4(c) apply if the negotiated price is below the threshold? Would that be an "exception," or are does "exception" refer only to the exceptions in FAR 15.403-1(b)?

@joel hoffman A note: I mis-cited the Federal Register notice in my last post. It should have been 74 FR 37644, not 77. Anyway, here is how the DAR Council explained the deletion: Again, that was 12 years ago.