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Our company has multiple Phase III SBIR IDIQ contracts through GSA, each of which can be used by DoD components to award FFP, FFP LoE, or T&M Task Orders. The TOs are negotiated using Alpha contracting processes, and are sole-source awards. The government’s requirement(s) for competition were met in the Phase I and Phase II awards under the SBIR program. The IDIQ solicitation and contract, and the resulting TOs, include the Subcontracting clauses 52.244-5 Competition in Subcontracting, 52.244-2, Subcontracts, as well as DFARS 252.244-7001 Contractor Purchasing System Administration. Subcontract purchases under these TOs require consent to purchase, as we are still in the process of setting up, but do not yet have, a CPSR-reviewed and approved purchasing system. Refer to the thread CPSR driven by FAR 52-244-2? for the kind of logic I want to apply to make sure we get all relevant contracts and subcontracts into the population of CPSR-reviewable purchases (and exclude those that don't need reviewed). Are the subcontracts and purchase orders for TOs that are firm, fixed-price subject to the CPSR? The two sides of the argument: IN: Since the TOs are not competitively awarded FFP TOs, their subcontracts and purchase orders would be subject to a CPSR. OUT: The IDIQ, however, did fulfill the government’s requirements for competition, and the SBIR law says the awards should be considered to satisfy the requirements for competition. So perhaps the FFP TOs, and their subcontracts and purchases, should be excluded from the CPSR population? On which side of the fence should we come down? Are the FFP TOs in or out of the CPSR population? Thanks all! -
Does anyone have a contractor's purchasing manual they are willing to share? Or, at least a Table of Contents from one? I can find plenty of examples online from the government's perspective (agency, state, commission, board, ...), but none from the Contractor's perspective. With recent growth we expect to have to create a reviewable / auditable purchasing system, and don't want to have to start from scratch. Any suggestions for jump-starting the process would be welcome.
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1) Assume that FAR 52.244-5, Competition in Subcontracting, is (will be) included in an upcoming GSA IDIQ Phase III SBIR contract, awarded to our small business, against which multiple Task Orders will be awarded. The Phase III SBIR itself is not competed; the “competition” is considered to have occurred in Phases I and II. Similarly, TOs awarded under the Ph III SBIR IDIQ are not competed; as they are customer – not SBIR – funded. TO awards are made subject to Alpha Contracting rules, which allows for detailed negotiations with the end customer and GSA on scope, price, and technical approach prior to award. (The use of Alpha contracting may or may not matter to the questions below.) 2) Assume further that our company’s intent is to establish a Contractor Purchasing System that would fulfill the requirements of DFARS 252.244-7000 et seq., and that this clause will be included either at the IDIQ level or for each TO. We have neither an objection nor an impediment to implementing a purchasing system that would be compliant and pass a review, but we’re only now growing to the point where we need one. And so we now have to understand the work required. 3) In the WIFCON post Teaming Agreements and the FAR (https://www.wifcon.com/discussion/index.php?/topic/682-teaming-agreements-and-the-far) Vern Edwards makes a point about the difference between “practical” and “practicable,” with respect to competing sub-contracts. (a) It’s hard to discern a meaningful difference in definitions from Merriam-Webster.com. Some drill-downs into the difference are made at: (i) Gramarist: “Think of practical as a synonym of useful, and practicable as a synonym of doable and feasible," and (ii) Vocabulary.com: “Do you mean to say that a thing is sensible? Choose practical. Do you want to say it is possible? Choose practicable.” However: (b) DFARS 244.305-71, Contract clause, indicates that both DFARS 252.244-7001, Contractor Purchasing System Administration, and FAR 52.244-5, Competition in Subcontracting, should be used in tandem (“Use the Contractor Purchasing System Administration basic clause … (a) … 252.244-7001 , Contractor Purchasing System Administration—Basic, in solicitations and contracts containing the clause at FAR 52.244-2, Subcontracts”). And each uses a different word: (i) DFARS 252.244-7001 (c) (7) indicates that a Contractor’s Purchasing System “Use competitive sourcing to the maximum extent practicable…” [“doable” or “possible,” according to the distinctions above] (ii) while FAR 52.244-5, Competition in Subcontracting, requires subcontractors (and suppliers) to be selected “on a competitive basis to the maximum practical extent.” [“useful” or “sensible,” again according to the distinctions above]. 4) So here’s my first set of questions: Though there might be a difference in meaning, is there really a difference in intent? Especially when these clauses are to be used in tandem? If so, what would that difference be? And most importantly, can anyone discern what the intent of the paired clauses would be? (Possible? Or sensible?) 5) And then the second set: Does (could) the Alpha contracting process play a role in fulfilling either the practical or practicable competitive sourcing / competitive basis requirement(s)? If we identify subcontractors and suppliers in our pre-award discussions, and then include those in our technical and/or price proposals, and those proposals are incorporated into the subsequent Task Orders, does that not fulfill the intent of either or both DFARS 252.244-7001 or FAR 52.244-5? (Not very SBIR-like, but if we propose to paint your hallways using Sherwin-Williams paint, do we have to still go out and get quotes from Benjamin Moore, Behr, and Valspar? If we propose to set up your cloud using Amazon Web Services, then after award do we also have to get a quote for Microsoft Azure? If Dell is my teaming partner – not via a CTA, but having set up a Teaming Agreement with them to target an opportunity with a prospective client who would fund a TO award – then do I need to get quotes for IBM and HP hardware?) Thanks in advance for any help. I have to admit to being a lurker on this forum for years, and those of you who've sustained these discussions and provided your insights and guidance have been wonderful mentors and teachers - thanks!!
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We are a subcontractor for a multi-year FFP DoD contract. Our Prime was awarded an Order under Basic Ordering Agreement (BOA). The award to the Prime was non-competitive, as the Order supports a pre-existing Contract for which the Prime, ourselves and our subcontractors are the only sources with the requisite knowledge, experience, and technical expertise to provide the required supplies and services under the Order. The Prime has asked for the T&M proposal for our participation. We have historically avoided T&M efforts but the proposal scope is too broad for us and our suppliers to provide a traditional FFP for the effort. Our participation alone and the participation of several subcontractors will exceed $150,000. I have many questions but I’ll limit it two; I suspect the response may help answer the others. 1) Based 16.601(c)(2)(ii), do I understand correctly that we need to provide the hourly rates for ourselves and the hourly labor rates for each of our subcontractors separately? My understanding is the lack of competition restricts us from submitting blended labor category rates. 2) If I’ve understood the first, how do I capture the overhead costs related to subcontractor management? We don’t have a standalone role/position of subcontract manager, that task is shared between PM and CM. Can I add a fixed fee (e.g. 10%) to all subcontractor hourly rates? We’re still waiting on rates from our subs, in the interim can we bookmark the proposal by stating “xxxx will invoice at the subcontractor rates plus 10%.”? I’m hesitant with this approach and uncertain whether it would create a prohibited CPPC. A few notes: (1) we and the majority of our subcontractors are not supply COTS or Commercial Items; (2) no Materials will be provided – a technical labor effort; 52.216-30 was not included in the flowdowns. As always, appreciate the feedback and support from this forum.
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In commercial prime contracts, paragraphs (b) and (c) of FAR 52.212-5 each have a series of clauses listed that will apply to the contract if checked by the Contracting Officer (KO). Paragraph (e)(1) contains a list of clauses that must be flowed down to subcontractors regardless of any of the requirements listed in the paragraphs above. On several occasions I’ve seen instances where the KO does not check off a clause in either paragraph (b) or (c) that is listed in e(1) and that seems like the clause should be in the prime contract. For example, I’ve seen service contracts where the KO checks off a number of clauses in (c) but does not check (c)(2) for the Service Contract Labor Standards clause. Because it’s a service contract over $2,500 it appears the SCLS should apply, and as I read (e)(1), I should flow it down to a subcontractor, but the KO doesn’t appear to have included it in the prime contract by checking off (c)(2). Another example is 52.203-13 Contractor Code of Business Ethics, which is in the check-off list of (b) but is also listed as a mandatory flow-down in (e)(1). I’ve seen contracts in excess of $5.5M that appear to meet all requirements for the inclusion of 52.203-13, but the KO does not check this clause under (b)(2). Paragraph (e)(1), however, makes it a required flow-down to subcontractors assuming the subcontract meets the prescriptive requirements (i.e., is over $5.5M, etc.). In both my examples, if the KO didn’t check off those two clauses, they don’t appear to apply to the prime contract (without regard to the Christian Doctrine), but (e)(1) says I have to flow them down. I’m trying to understand the logic behind paragraph (e)(1) in instances where the KO doesn’t put a check mark next to a clause in either paragraphs (b) or (c), but the clause is listed in (e)(1) and it appears the clause would apply to the prime contract and thus should be flowed down as appropriate? It could be that the KO simply made a mistake in failing to check a clause that should apply to the prime contract (I’ve certainly seen RFPs/contracts where the clause is included full-text but none of the clauses in (b) or (c) are checked, but here they’ve gone through the process of checking a number of the (b) and (c) clauses but missed two that certainly seem applicable at the prime level). So for those clauses listed in (e)(1), this methodology of requiring a check off above but mandating the clauses in (e)(1) be flowed down leaves a confusing situation if apparently applicable clauses aren’t checked. For folks experienced at building commercial subcontracts, do you just flow down all the clauses in (e)(1) as applicable even if the KO didn’t check off one that seems like it should apply? Thank you for any insight you can offer.
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For a small woman owned business (OEM manufacturer), what is the true advantage for insisting on selling its product solely as commercial items? If selling as non-commercial items, CAS does not apply as company is a small business. Technical Data Rights clauses do apply but with careful planning, company's technical data can remain its own. It seems that most FAR and DFARS clauses of import would revolve around providing of certified cost and pricing data (FAR 52.215-10 thru 14) and (FAR 52.215-20 and 21), and Audit rights (FAR 52.215-2). It seems to me that the government and primes have a hard time or are unwilling to evaluate "commercial item" justifications. Occasionally, even if the prime has accepted the commerciality assertion, DCMA will do their audit or engage a third party (like the Navy Price Fighters), who reject the CID. All this results in solicitations being issued as FAR Part 15. To state the question above differently: What is the true danger in selling as non-commercial items?
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If a government prime contractor issues a Time & Material subcontract, can the G&A applied to materials be a fixed/lump sum value, so long as that lump sum value is established and set at the time of award? I understand the four criteria established in Urban Data System v. US, but I am trying to determine if the only way to surely avoid violation is to reconcile the G&A rate applied to materials to actuals at the close of an accounting period.
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Hi All, I work for a small federal contractor (90% of our work is gov't contracts) that does not have a purchasing department. Rather, our engineers do their own purchasing. Needless to say, this is a nightmare for me from a compliance standpoint, and the President of the company (also an engineer) is resistant to change. I've recently discovered that we are issuing POs for direct charge parts and materials where multiple contracts are charged to one PO. However, rather than noting the allocated amount being charged to each contract's project number, we are assigning a percentage value of the cost of each line item that is to be charged. Here's an example: Widget qty 10 unit price $1 total $10 Contract #A 20% Contract #B 35% Contract #C 42.5% IR&D Project 2.5% I've never seen a company do this before. Is this ok, or do we need to show the exact dollar amount allocable to the contract or project to which the items are charged? Thanks in advance for your thoughts!
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My company has been awarded a subcontract from a prime NSA (Ft. Meade) contractor, a small business. The award was a stand alone contract to the prime. The prime contract and subcontract were both awarded as FFP (not T&M or cost plus) , and we bid the subcontract as FFP. The referenced clause was included in the award to the prime; it reads, in part, as follows: In order for the COR to conduct a complete and thorough invoice review, the contractor shall provide the following as an invoice attachment for each Technical Task Order (TTO)...: 1) The individuals by labor category being billed for the invoice period 2) The hourly rate for each category/individual. 3) The total number of hours per category/individual. 4) The total amount billed for each category/individual. I cannot find the clause; the NSA states that it uses DFAR and FAR for its acquisitions, but I cannot find it anywhere. The only Section 352 I've identified is for Health & Human Services, and that doesn't include this section. I'd like to provide the prime with an argument to take to the Government to remove the clause because of its inapplicability or, failing that, demonstrate that it's not a mandatory flow down. Complying with it will cost us considerably more than we bid on this relatively small task order. Any guidance you can provide will be greatly appreciated. Many thanks.
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Scenario: Lower-tier subcontractor performing on a DO issued under the restricted suite of an IDIQ MATOC for maintenance and services. The DO contained 2 types of CLINS: 1. FFP (for preventative maintenance) and 2. T&M (for corrective maintenance). Prime contractor (Company A) submitted hourly labor rates to Govt.; the resulting award contained the hourly rates but no details are given regarding whether the rates for each labor category are for the prime or its subs. NOTE: lower-tier sub was not involved with prime contract in any capacity until well after the award. As such, it was unable to participate in the hourly rate discussions/negotiations between the prime and first-tier sub. In addition, the lower-tier sub was not given any information about said discussions/negotiations. First-tier sub to Company A issued subcontract to lower-tier sub for both CLINs. Beforehand, lower-tier sub quoted its GSA FSS contract hourly rates to first-tier sub; the first-tier sub accepted said rates. Lower-tier sub hourly rates accepted by first-tier sub were was much as $14.00/hr higher than those in listed Company A's prime contract. To the best of this writer's knowledge, the rates in Company A's prime contract had not been disclosed to the lower-tier sub prior to it submitting its proposal to, or receiving its subcontract from, the first-tier sub. CAVEAT: the lower-tier sub is also a contract holder under the same MATOC (lower-tier sub's award was in the unrestricted suite) and most likely has the same KO administering its contract as Company A. The lower-tier sub's hourly rates negotiated with (and accepted by) the Govt. on its award are the same as above - its GSA FSS contract hourly rates. The Govt. is definitely aware the lower-tier sub is also performing under Company A's award as a lower-tier sub. Issue: Lower-tier sub performed multiple CLIN 2 corrective maintenance services over several months, during which time it invoiced its labor at the $14.00/hour higher rate. Govt. accepted all invoices and lower-tier sub was paid at the higher rate. During this time, the lower-tier sub is still unaware of Company A's negotiated rates. Out of the blue, the Govt. decides it no longer wants to pay the lower-tier sub's higher rates and directs Company A to pay the lower-tier subs at Company A's lower negotiated rate. Argument: Lower-tier sub is well aware of the regulations governing T&M work and concurs it must abide by the rates in Company A's contract. The lower-tier sub does, however, take issue with the Govt. changing its position "midstream" on the hourly rates. Does the lower-tier sub have any valid arguments to make? If so, what are they? -
Our company is new to the government arena and so I'd appreciate the gentle help of those with experience. We have a recently awarded IDIQ and when the individual subcontracting plan was included and accepted in the proposal phase, the box was checked for "indirect costs have been included". Can anyone advise as to a good method of assembling what indirect costs (janitorial, for example?) are acceptable? Also, the contract states "The total of this governement contract divided by the total corporate sales will provide the prorate factor." For total corporate sales should we use the three year average used on SAM? If anyone knows of any resources besides the FAR, ti would be appreciated. Thanks.
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Is there a requirement that if a Prime is awarded an FFP contract and the Prime has a Sub performing some of the work, that the type of SubK issued must mirror the Prime's contract? If not, what might be some of the advantages and disadvantages of issuing a Cost Reimbursement type SubK and is the Prime allowed to cap the number of hours the Sub may invoice the Prime for?