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napolik

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Posts posted by napolik

  1. No, like I said, there has been no guidance or communication of any kind from the leadership in my office on this subject. Perhaps I will suggest it.

    When the Test Program for use of Simplified Acquisition Procedures for Certain Commercial Items expired in January 2008?

  2. When the Test Program for use of Simplified Acquisition Procedures for Certain Commercial Items expired in January 2008, the Chairman of the Civilian Agency Acquisition Council sent out a memo to all civilian agencies that served as "consultation" for a class deviation to extend the use of the Test Program until the FAR was rewritten to reflect an extended date that had not yet been promulgated. The memo said in part:

    "Pending issuance of a final rule effecting the change, it is recommended that civilian agencies authorize a class deviation in accordance with FAR 1.404 to extend the program."

    In fact, the CAAC has sent out several such mass memos in the past to civilian agencies to recommend class deviations to many different parts of the FAR, including two this year. Here is a current listing: https://www.acquisition.gov/comp/caac/caacletters.htm

    If the CAAC sent out a similar such "consultation" memo to agencies recommending a class deviation to allow parity among HUBZone, 8A, and SDVOSB firms, each civilian agency could authorize their own class deviation and put this issue to rest until the new law is passed and new rule promulgated into the FAR.

    Did your HCA issue a deviation?

  3. I'm not arguing that the FAR is right. However, the FAR places limits on the CO's authority to pursue a policy that is inconsistent with it. Yes, FAR 1.602-1(B) requires the CO to comply with all requirements of law, etc., but doing so may require the CO to deviate from the FAR. You imply that if the FAR is inconsistent with other rules, an individual CO can decide to deviate from the FAR without approval from the agency head. On what legal basis? I don't see this discretion given to the contracting officer at FAR 1.4.

    Does the OMB memo of July 2009 carry any weight?

    Quote

    Pending the completion of the legal review of the GAO?s decisions by the Executive Branch, the SBA?s ?parity? regulations should not be disregarded by contracting officers, and Federal agencies should not, as a result of the GAO?s decisions, be compelled to prioritize HUBZone small businesses over 8(a) BD or SDVOSBs. Instead, until the legal review is completed, Federal agencies should continue to give active consideration to each small business program pursuant to their pre-existing contracting practices and ?parity? policies.

    Unquote

  4. I am in DoD. Does it have to meet all three of these, i.e. severable? This contract is non-severable.

    There are two options for finding a fixed price contract incrementally:

    1. The contract (excluding any options) or any exercised option is for severable services; does not exceed one year in length; and is incrementally funded using funds available (unexpired) as of the date the funds are obligated;

    or

    2. The contract uses funds available from multiple (two or more) fiscal years and the contract is funded with research and development appropriations; or Congress has otherwise authorized incremental funding.

    Option 1 requires the contract to be for severable services. Option 2 does not.

    You are not the first DoDer to confront DoD's discouragement of use of T&M / LH contracts. DoD prefers that you move from T&M or LH to FFP type contract, not to the FFP LOE type. Note that DoD collects info on these contract types and on the FFP LOE contract type. If you cannot do a FFP contract, move to a cost type.

  5. Can someone tell me where I can find guidance on incremental funding and Firm Fixed Price, Level of Effort? Initially, we were going to do the contract as a Time & Materials contract but have been told that we can no longer do T&M contracts. I read FAR 16.207 and believe that this type of contract would work in the place of the T&M; however, the customer plans to provide funding incrementally. Is this really incremental funding or is it phase funding, is there a difference? This is a non-severable contract, if that helps.

    I have been looking for guidance on this topic and cannot find what I am looking for.

    See also here:

    Quote

    232.703 Contract funding requirements.

    232.703-1 General.

    (1) A fixed-price contract may be incrementally funded only if?

    (i) The contract (excluding any options) or any exercised option?

    (A) Is for severable services;

    (B) Does not exceed one year in length; and

    ( C ) Is incrementally funded using funds available (unexpired) as of the date the funds are obligated; or

    (ii) The contract uses funds available from multiple (two or more) fiscal years and?

    (A) The contract is funded with research and development appropriations; or

    (B) Congress has otherwise authorized incremental funding.

    (2) An incrementally funded fixed-price contract shall be fully funded as soon as funds are available.

    Unquote

    If your are not in DoD, check your agency's FAR supplement.

  6. I read that already. I was looking answers to my scenario specifically.

    I assume your scenario or question is implict here: "I was told that I could award the contract and issue the first Task Orders under a "phase in" period (2 months) and then have a 12 months base and 4 - 12 month options. I argued that once I issue Task Orders, I have started the performance period."

    Your "scenario" assumes 62 months of performance. 60 months is the max period.

    If I have inferred erroneously, please restate your scenario or question.

  7. Quote

    Actually, an LPTA procurement is part of the best value continuum. I believe the distinction you were trying to make is a Tradeoff Process (FAR 15.101-1) vs LPTA (FAR 15.101-2).

    Unquote

    In its decision, the GAO described the basis of award as "best value". Typically, a source selection using factors in addition to cost or price is called "best value".

    Quote

    I think GeoJeff was trying to point out what he views to be a general principle that applies to both types of procurements. Specifically, an offeror's price may be so high that it renders the proposal ineligible for award regardless of the technical merit or rating of the offer. In a tradeoff procurement, that will happen if, as GAO says, the "quoted price [is] too high in an absolute sense." In an LPTA that will happen if another technically acceptable proposal offers a lower price.

    Unquote

    The thread commenced with this question: "When conducting a lowest price technically acceptable source selection (see FAR 15.101-2), if the offeror with the lowest price is technically acceptable, may the agency award to that offeror without evaluating the technical acceptability of the other offerors?". The Gold Cross case involved an extraordinarily large price differential, and it did not address whether or not the contracting officer is obligated to perform a technical evaluation of all offers. Thus, I don't think it offers support for a "Yes" answer to the initial question.

  8. See matter of Gold Cross Safety Corporation, B296099, here: http://www.gao.gov/decisions/bidpro/296099.pdf. While not directly on-point, in Gold Cross the GAO states:

    "?Since Gold Cross could not receive the award due to its unreasonable price, the results of any technical evaluation the agency may have subsequently performed were immaterial; even if Gold Cross? technical submission received the highest possible rating, it could not receive the award due to its unreasonable price."

    Substitute the phrase "because there was a lower-priced, technically-acceptable offeror" for the phrase "due to its unreasonably price," and viola. There, as here, a technical evaluation would be "immaterial."

    Thoughts?

    Be careful, the Gold Cross case is not on point for a couple of reasons. First, it involves a best value source selection. This thread is dealing with a source selection made to the lowest priced, technically acceptable offer. Second, in Gold Cross, it is significant that the protestor's price was 8 to 20 times higher than other prices and the Government estimate. In the case of LPTA, the variance in prices among offers is irrelevant so long as you award to the technically acceptable offer with the lowest price.

  9. Napolik,

    Here is what the GAO said about Shay Assad's memo:

    Actually, the GAO decision is dated 14 May while the Assad memo is dated 18 May. So, GAO could not have been commenting on his memo.

    I am sure there is frustration in dealing with the competing OMB and GAO views on the "parity" of the three socioeconomic programs. But, we are part of the Executive Branch, and we must follow the direction of the Executive Branch leadership.

    Speaking of delay and frustration, what happened to action to nullify the October 2008 GAO Delex decision that applies the rule of two to multiple award contracts?

  10. This approach is consistent with law, regulation, and the decisions of the GAO and the COFC. If the folks at Eielson would have followed this advice, their contract would have been awarded by now.

    What do you say to Shay Assad? In his May 18 memo he says that the OMB policy on SBA parity regulations "... continues to be Executive Branch policy and components shouild follow the OMB guidance and all applicable regulations."

  11. Hey Vern - I did what you suggested - contacted the office that issued me my warrant. As usual (SMILE) you are correct - it's each contract action, not a cumulative total of all actions on a contract. Thanks for the guidance.

    While you have legal authority to sign actions up to $10 million, your agency or your office may have administrative controls that limit your ability to exercise your warrant. Such policies may require reviews above the contracting officer level of all proposed actions exceeding $10/$20/$50 million. I have seen such policies. Sometimes, these policies define the dollar thresholds for reviews to include the value of all options, or they focus on the total estimated or maximum contract amount.

    Be sure to adhere to your internal policies before signing any contracts.

  12. Good Morning-

    I was looking at the Solicitation Preparation Guide for the Acquisition of Commercial Items by DoD found in the Quick Kit/Tools section of the WIFCON website and have a question that I'm hoping someone can answer. It states that 52.225-1, Buy American Act-Supplies, 52.225-3,Buy American Act-Free Trade Agreements-Israeli Trade Act and 52.225-5, Trade Agreements Act are "not for Dod use". Why not and where does it say that?

    Thank you.

    ps..find all the info on WIFCON very good and have recommended it to may people.Heard about it at one of the FAR Bootcamps.

    See DFARS 225.1101 "Acquisition of supplies". The DFARS offers its own clauses in lieu of the three you identified.

  13. If one has an active $1m+ contract (DoD, R&D, CPFF) in place, would a new Certificate of Current Cost or Pricing Data be required for a $200k mod?

    My reading of FAR 15.406-2 indicates, that, YES, once the contract (generally over $650k) requires the Cert, any mods relating to funds (+ or -) would require a Cert.

    Appreciate any responses. thank you.

    As the threshold for obtaining cost or pricing data is $650,000, you need not obtain either the data or the certificate. See FAR 15.403-4 (a).

  14. At one time, the T&M payments clause required withholding of $50,000 relating to the cost of labor hours under such contracts. I have a recollection that there was an ASBCA (?) decision holding that the withholding only applied at the contract level and not the task order level under IDIQ contracts. Unfortunately, the only mechanism I have for doing research on ASBCA decisions is the service provided by GWU. The search engine has been removed from that site. Does anyone have any information on this decision that my somewhat erratic memory says exists?

    Thanks.

    I cannot find an ASBCA decision, but I did find the following in the July 27, 2005 Federal Register dealing with FAR Case 2004-003:

    Quote

    Task Order Versus Entire Contract

    2. Comment: A respondent stated that the proposed rule is unclear

    as to whether the $50,000 ceiling on withholding applies to an

    individual task or to an entire contract. It recommended the proposed

    rule be clarified to identify the basis for application of the ceiling.

    The respondent added that it had previously recommended in an audit

    report that the $50,000 ceiling be applied to each order where orders

    are closed separately. The respondent's recommendation is based on the

    belief that the clarification will assist contracting officers in

    performing their jobs.

    Councils' response: The Councils agree that it would assist both

    contractors and the Government if the proposed rule were clarified as

    to whether the withhold ceiling applies to an entire contract or to

    individual orders. Such a clarification would reduce any possible

    confusion by either party as to the applicability of the ceiling and

    thus remove the potential for disagreements. The Councils agree that

    the withhold ceiling applies to the entire contract. Therefore, the

    Councils have revised the guidance at FAR 32.111(a)(7)(iii) and the

    clause at FAR 52.232-7(a)(2) to clarify that the withhold ceiling

    applies to the total contract.

    Unquote

    The source is here: http://regulations.justia.com/view/18937/.

  15. FAR 9.140-1(e) statest that a company must "Have the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them". Under the organization part of that standard, can a company be determined nonresponsible if the CO considers their subcontracting arrangement to be too risky or unstable?

    For example, a situation is created where the sub becomes more key to performance than the prime because the prime will sub out all or most of the work to a sub who will further sub out the work to several 2nd tier subs. That seems like an extremely risky situation. Successful performance hinges entirely on the 1st tier sub.

    Would such a situation be reason enough for determing the prime to be nonresponsible for not having the necessary organization, even if the solicitation was silent about such subcontracting arrangements?

    Yes. See FAR 9.103( c )

    Quote

    A prospective contractor must affirmatively demonstrate its responsibility, including, when necessary, the responsibility of its proposed subcontractors.

    Unquote

    Also, review 9.104(e), including the final word:

    Quote

    (e) Have the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them (including, as appropriate, such elements as production control procedures, property control systems, quality assurance measures, and safety programs applicable to materials to be produced or services to be performed by the prospective contractor and subcontractors).

    Unquote

    You do not need to say in the solicitation that you will consider subcontractors as part of your review of contractor responsibility.

  16. It seems the discussion in this thread has forgotten about FAR 17.1. While I agree consideration of multiyear contracts is advisable this thread makes it seem like it is a simple decision, just do not have options have multiyear. I would suggest that the decision is a little more detailed in consideration of the policy and requirements stated in FAR 17.1. I would agree with one comment in the thread that responses do not do justice to explaining rationales for selecting a multiyear over a option year contract..

    The discussion involves an IDIQ contract with a 5 year ordering period vice an IDIQ contract wiith a 12 month ordering period plus four, 1 year options. It does not involve use of a multi year contract.

  17. Don-

    Thanks for the reply.

    Napolik-

    Maybe. But do you think this logic applies to a Multiple Award ID/IQ? I do not, and I have seen options on MATOCs.

    You also wrote:

    "Administratively, it is probably easier to withhold an option exercise than to terminate a contract."

    Agree, but it's easier (and I say generally smarter) to do nothing than to exercise an option. A longer ordering period obviates the need for options, no?

    Formerfed-

    Not sure I've ever seen mins on options. How sheltered am I?

    I think you underestimate the impact on a contractor of the decision to exercise or to forego an option. It is an easy means of focusing the contractor's attention on providing top flight performance.

    If the contractor is not performing as well as you?d like, doing nothing may not be an option.

    I understand the benefits of using an extended ordering period vice options. I like options for the reasons I state. I do not make the exercise of the options a labor of Hercules.

    Contracting is an art, not a science. Every contracting officer is an artist who has many brush strokes available to create a masterpiece.

  18. I think that many 1102s either do not know that it's permissible to have a multiple-year IDIQ contract without options or they do know and are unwilling to try something different. I've been on the same quest to find a good reason why there are so many IDIQ contracts with options for years and have yet to find an answer.

    The threat to forego exercise of an option does have a salutary effect on contractor performance. Administratively, it is probably easier to withhold an option exercise than to terminate a contract.

  19. I am working on a new requirement for a utility contract. I've reviewed part 41, and I don't see any reason why I can't use Simplified Acquisition Procedures under the test program. Is there an inherent restriction on using SAP for utility contracts?

    Thank you.

    Given the definition of "contract" in FAR Part 2, I do not see a regulatory barrier if you comply with FAR 13.302 and 41.5.

  20. FYI, this extract comes from the GSA solicitation for SIN 874 of the MOBIS program:

    Quote

    (B) Travel: The Contractor may be required to travel in performance of orders issued under this

    contract. Allowable travel and per diem charges are governed by Pub .L. 99-234 and FAR Part 31, and

    are reimbursable by the ordering agency or can be priced as a fixed price item on orders placed under

    the Multiple Award Schedule. Travel in performance of a task order will only be reimbursable to the

    extent authorized by the ordering agency. The Industrial Funding Fee does NOT apply to travel and per

    diem charges.

    Unquote

    I believe this reflects a commerical approach to dealing with travel.

  21. It just goes to show--if you're gonna break the rules, break 'em big time.

    Interesting DODIG report.

    Over the course of 17 years, I underwent 6 PMRs. Since ship repair was such a large and important part of the business, our orders under MARAVs received special scrutiny. There were no comments on the improper funding of contingent liabilities. Perhaps the PMR teams did not recognize the obligations as improper because they had an empirical basis - all ship repairs had growth due to the inherent nature of the work. They were not wild guesses or efforts to dump monies. The estimates certainly were not developed like this method taken from an example in the report:

    Quote

    Growth Pools

    Contracting officers at the three maintenance activities inappropriately obligated approximately $63.5 million on 341 MSMO contract modifications and 13 IDIQ orders for growth pools. The obligation of growth pools violates 31 U.S.C. 1501, DoD FMR, volume 3, chapter 8, and the JFMM because the maintenance activities did not identify the specific work at the time of the obligation. Maintenance activities obligated funds without a sufficient description of the specific products or services needed to support the growth pool amounts. For example, a Business Clearance Memorandum supporting one contract modification stated:

    Funding put against this WI [work item] becomes a contract obligated pool reservation for undefinitized growth work that is encountered during the availability5. . . The ACO [Administrative Contracting Officer] backed into this dollar amount after definitization of all other TYCOM [Type Commander] funded WIs. The ACO determined amount for this growth pool reservation is $401,594.

    Unquote

    In any event, I escaped with no indictments, arrests or convictions.

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