Don Mansfield

Seems like a good question for the contractor. Maybe none. It could also be a deviation from the FAR. I would get a legal opinion. It would be interesting to see what the contractor would say if you proposed adding something like: "Nothing in this supplementary language shall be read to excuse the contractor's obligations stated elsewhere in this contract. In the case of a conflict between this language and any other term of this contract, the other term shall take precedence." You'd probably find out what they are trying to protect themself against.

That wouldn't be consistent with the FAR's use of "incentive contract". FAR 16.401(a) distinguishes incentive contracts from FFP contracts: FAR 16.202-1 permits the use of incentives based on factors other than cost: Given FAR 16.401(a), such contracts are not incentive contracts. So, you can have contracts with incentives that are not "incentive contracts" as that term is used in the FAR. Also, see FAR 16.402-1(a):

A compensation arrangement described in FAR part 16 that contains a cost incentive (or in the case of a contract with multiple incentives--a cost incentive or constraint).

@FrankJon, It's a very common mistake to assume that a contract with an incentive is an incentive contract. I've made the same mistake. Judges make mistakes. It was this judge's turn to make that mistake. Fortunately, that mistake was not consequential in this case.

Get well, Bob.

Right

Folks were citing the FAR. My point was that the FAR is not relevant to the issue.

If the contract doesn't obligate appropriated funds, it's not acquisition and the FAR doesn't apply.

You have a requirement exceeding $25,000 for an item to be specially manufactured for the Government in accordance with a technical data package (TDP). There are several manufacturers that are capable of performing the contract and you anticipate issuing a competitive solicitation. The bill of materials in the TDP requires the use of some brand name components in the manufacture of the item. FAR 11.105 states: Are you required to justify the use of the brand name components and post the justification? Assume the sum of the brand name components exceeds $25,000.

Additionally, I don't think using a noncost incentive would change the contract type from T&M to something else. For example, the contract type remains the same when using noncost incentives in firm-fixed-price contracts and fixed-price contracts with economic price adjustment. See FAR 16.202-1 and FAR 16.203-1(b).

If the direct labor is not for the work required to increase retention (i.e., it's for performing the contract requirements), then I agree that you don't need a constraint.

Wouldn't you want to put some type of constraint on hours or price, above which the incentive would no longer apply? For cost reimbursement contracts, a cost incentive or constraint is required if the contract is going to contain an incentive on something other than cost. Given the "best effort" nature of the T&M contract, I would think you'd want the same type of safeguard.

Do you think that, by definition, a charge of profit/fee on a subcontract is an excessive pass-through charge? That would be wrong. Including the cost of subcontracts in Block 14 of the DD Form 1547 when developing your prenegotiation fee objective would be correct. I would only exclude it if the prime contractor's efforts provided no or negligible value. Alternatively, leave it as is and assign a lower-than-normal value for Management/Cost Control on the form.

Really? FAR 16.601(b) says: Doesn't say anything about fee. I also looked in both FAR 52.212-4, Alternate I, and FAR 52.232-7 and did not see anything about payment of fee.

The contractor used weighted guidelines to come up with their proposed fee?