Vern Edwards

@Jamaal ValentineThe under-does-when approach takes some thought. I don't think it would be suitable for "quick" questions. For those not familiar with the under-does-when (or under-when-does) approach to presenting a legal issue, see https://law.utexas.edu/faculty/wschiess/legalwriting/2007/05/issue-statements-under-does-when.html. Also see https://law.utexas.edu/faculty/wschiess/legalwriting/2007/05/issue-statements-whether-style.html. Note that the author says, "This [under-does-when] style is better than the 'whether' style because it is a complete sentence. But it still produces long, complicated sentences." One must think long when crafting a long sentence. Also, one of the problems with Wifcon questions is faulty "setup," which happens when the OP does not provide clear, sufficient, and relevant background. There are two approaches to setup: 1. Here is my situation. Here is my question. I like this approach when the background can be provided in one or two short sentences. Here is my situation: I am a CO getting ready to conduct my first source selection, for along-term complex service contract. Here is my question: Under FAR Part 15, does the government have to conduct discussions when it receives more than 10 proposals? and 2. Here is my question. Here is my situation. I prefer this approach when the background is long and complicated. Here is my question: Under FAR Part 15, does a CO have to conduct discussions when the RFP said that award would be made without discussions, the government has received a large number of proposals, and a contract specialist engaged in an unauthorized exchange of information with one of the offerors? Here is my situation: I am a CO conducting my first source selection. Our RFP said that we were going to award without discussions. We have received and evaluated 10 proposals. A contract specialist working for me contacted one of the offerors at the request of the SSEB but without my permission to ask for clarification of its proposal. The offeror emailed the contract specialist a five-page explanation and "clarification," which I have not yet provided to the SSEB. Our lawyer is on leave until the end of next week. I am under pressure to keep the source selection moving because the requirement is urgent. FAR does not address this situation. We really don't want to conduct discussions.

@joel hoffmanI have noticed that when Patrick3 has written an opening post he has opened with "Quick Question." A quick question about contracting is almost invariably a lousy question. That's because contracting is complicated, and so are the issues and the questions. And I have noticed, as have several others, that Wifcon Forum is infested with lousy questions. Why is that the case? How can we teach people to craft good questions? (Note the word "craft".) It has become an obsession with me. One of the most important skills a contracting practitioner must master is the ability to craft good questions. The ability to craft good questions is essential to almost every facet of contracting. It is essential to statement of work preparation, proposal evaluation, contract pricing, contract formation, interpretation of regulations and contracts, contract quality assurance, analysis of requests for equitable adjustment and claims, dispute resolution, you name it—a practitioner must ask questions. Lawyers know that, and they get some practice in law school if they have good professors and fellow students. They get more practice during their associate apprenticeship. But contracting people get no training in the craft of question-design. Why not? There are literally hundreds of books and articles about asking questions, maybe thousands. But except for books about developing questions for social science survey instruments, I have found relatively few that teach the general principles of question design, which involves more than just writing an interrogative sentence. I have thought about writing an article or even a short book about it, but I've been afraid of making a fool of myself. It's a difficult subject. I know only that when I want to ask a question in a formal setting I spend a lot of time thinking about what I want to know and how to communicate that to the person I'm asking. I also think about what context to provide to the person I'm asking, and how to provide that information as clearly, completely, and concisely as possible. (Which requires putting myself in that person's shoes.) In order to know what context to provide I may have to research the subject of the question. (In the course of doing that I might answer my own question.) But the internet and websites such as this one encourage "quick questions" from the clueless and thoughtless. Asking a good question ain't an easy thing to do. It takes skill. Ye shall be judged by your questions, so don't be quick.

Rude? By telling you how to find the funds to pay the bill? Time wasted, because you completely mischaracterized the situation in your opening post. You ought to be embarrassed.

@ji20874Don't say anything. Just count to 100 and consider this thread dead.

@REA'n MakerMaybe, but I don't buy it. If you are providing an incentive to get vaccinated, and if a person is exempt, then they don't qualify for the incentive. I don't see that as improperly discriminatory. But I don't know much about EEO law and regulations. So you might be right.

See the GAO Red Book, Ch. 5, Section D.4, "Closed Appropriation Accounts":

@REA'n MakerWell, if you are the CO, and if you think it's reasonable, then I would expect you to allow the cost. Can you cite the applicable EEO law or regulation and explain how not giving a vaccination incentive to someone who is exempt and unvaccinated would violate it?

See this: https://www.awrcounsel.com/blog/2019/8/20/now-you-see-it-now-you-dont-service-contract-act-coverage-of-indirect-employees

Well, then, everybody can state their status, refuse vaccination, and get $500, for which the government will compensate the contractor. Is this a great country, or what?

It depends on the reason for the decision. Nothing more, nothing less.

Well, if the contract were FFP, I would address the matter during price negotiations. No contract clause would be involved. If the contract were cost-reimbursement, I would rely on the Allowable Cost and Payment clause, the cost principle at FAR 31.201-4, and any applicable CAS, probably CAS 418. If the contract were fixed-price incentive—FPI(F) or FPI(S)—I would rely on the appropriate incentive price revision clause. If the contract were T&M or L-H, I would address the matter during negotiation of labor rates. I don't know what you mean by "overcome your burden of proof." It would be an issue of interpreting and applying FAR 31.201-4 and maybe CAS 418. The facts would be the facts. If we couldn't agree on allocability and the ultimate allowability of some part of the cost, I would encourage the contractor to submit a claim. I would invite the contractor to meet with me and bring its attorney and cost consultant (maybe you) to present its case. I would then make a final decision. If I wrote a final decision denying the claim, and if the contractor appealed, well, I'd consider the amount of money involved and seek advice of counsel. In short—yawn—no big deal for a cool-headed old salt professional.

If I were an ACO I would argue that a companywide vaccination incentive program benefits the company as a whole and all of its customers. I would not agree to allocation of the costs of such a vaccination incentive program as a direct cost.

@HitTheNutzWell, it strikes me as strange. I presume it was done to keep peace among employees. Maybe the contractor can make a case for doing it. If I were the CO determining allowability I would require the contractor to show why it's reasonable to pay the incentive for an exemption.

Why is the contractor doing that? What are you encouraging the exempt to do? What is the benefit of an exemption to your company or to the government?

Why 10 percent? Why not another number? See my remarks, above, about socio-political tradition and consensus.

Wrong again. The WGL ranges were not designed to reflect what was going on in a free market, because there was (and is) no free market for the kinds of work to which they were to be applied. (See Peck & Scherer, The Weapons Acquisition Process: An Economic Analysis (Harvard, 1962), pp. 55-64 .) The WGL ranges were designed to provide a rational and consistent basis for setting profit or fee objectives based on a socio-political consensus among politicians, bureaucrats, and business people about what would be fair for certain kinds of negotiations—in particular, negotiations in non-market transactions, such as weapon research and development. The goal was consistency within a tradition and a consensus among participants in a monopsony. A tradition and consensus that had been developed in negotiations between government and industry over the course of many years, since before and immediately after WWII. LMI alluded to that consensus in pages 42 - 48 of its report. It does not follow that such traditional consensus rates had "no logical basis" just because you don't understand the logic. They were, in fact, very logical, but the logic was not free-market logic.

Yes. It would be a lot of work. You would have to publish a proposed rule and deal with public comments. And how would you be better off? There are statutory limits. Just set prenegotiation objectives and negotiate within those limits.

I thought we were talking about the weighted guidelines. The fee limitation on non-R&D CPFF is 10 percent, not 15 percent, of estimated cost, and it is statutory per 10 USC 2306(d) and 41 USC 3905. So are we talking about WGL or statute?

Big mistake.

I have found the LMI study at the Haithi Trust: https://babel.hathitrust.org/cgi/pt?id=uc1.l0050759224&view=page&seq=7&skin=2021 Unfortunately, you cannot download or print it. You can only read it online. Good luck reaching anyone at LMI. Apparently, they are all working from home. Covid-19 appears to have finally put an end to business communication by telephone.

That's wrong. Way off base. A lot of analysis and theory went into the development of the WGL. Nevertheless, there have long been questions about the effectiveness of the WBL.

The Weighted Guidelines (WGL) method was the product of a study by Logistics Management Institute (LMI) that was done for DOD and presented in 1963. The first version of the WGL was added to the Armed Services Procurement Regulation (ASPR) on November 23, 1963, 28 Fed. Reg. 12555 - 12561. You can see the original ranges there. The ASPR adopted the LMI recommendations with minor changes. A reasonably good discussion of the origins of the WGL contains an appendix that includes the original LMI recommendations. See Craig and Pousardian, Weighted Guidelines: An Empirical Investigation of Research and Development Acquisitions, Appendix B, which can be accessed at https://apps.dtic.mil/sti/pdfs/ADA123040.pdf. See also Trueger, "Defense Contract Profits - Weighted Guidelines Method," Journal of Accountancy, February 1965, p. 45. If you call LMI you may be able to obtain a copy of their original study report. I don't think it is available online. I don't know of any copy in any library.

Agreed. When a contract clause, such as a Changes clause, provides for a price adjustment based on the effect of some event on the contractor's cost of performance, or when it seeks breach damages, the amount of the adjustment must be based on incurred or estimated allowable cost plus a reasonable profit. See Kellogg Brown & Root Services, Inc., ASBCA 57530, 19-1 BCA ¶ 37,205: There is one exception to that rule—when, in the absence of cost information, a court or board adopts the "jury verdict" approach to determining an equitable adjustment or breach damages. See Cibinic & Nash, The "Jury Verdict" Approach: Equitable Technique or Contractor Bonanza?, in The Nash & Cibinic Report (December 1991). The authors discuss four versions of the jury verdict approach. See also Cibinic & Nash, Equitable Adjustments: Cost or Value?, The Nash & Cibinic Report (August 2019).

@WifWafYou are making this too hard. As ji20874 has pointed out, the purpose of TINA is to ensure the CO has the information needed to make a reasonable estimate of what it will cost the contractor to perform. The presumption is that a reasonable cost plus a reasonable profit will equal a reasonable price, no matter how the contractor has set its price. That would be the government's going-in negotiation position. As mentioned at the beginning of this thread, there are at least three approaches to pricing, only one of which is cost-based. The other two are market-based and value-based. And some companies likely use some combination of methods. How about we apply TINA only to major system production contract actions and allow agency heads to apply it to sole source contract actions valued at less than the major system threshold but more than $50 million on a case-by-case basis and with written risk-based justification. That would reduce the cost of its administration, but would entail some risk of price gouging. We'll reduce that risk by setting up a special pricing and negotiation training program for experienced COs who will be assigned to negotiate cost-based pricing actions. We'll let agencies request noncertified cost or pricing data in sole source contract actions valued at between $50 million and $10 million when pricing will be cost-based, but not when it's market-based or value-based. Offerors would have to disclose their pricing method. When pricing is market-based or value-based, offerors would have to provide a description of how they arrived at the price they propose. Would that scheme expose the government to too much risk of price gouging? Would the risk exceed the cost of wider application? We don't know, so we'd have to do some fact-based policy analysis.

See FAR 31.205-17, which states, in part: I presume DCAA handles the matter in accord with FAR.