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vecchia capra posted a comment on 22 April to which I replied. vecchia then replied to my comment. I have been unable to copy the three comments and am niot going to retype them here, verbatim. I know that the Webmaster has stated that he desires running commentary on Blog posts to be directed to the Forum, not in the Blogs.

The Blog article concerns the Court of Federal Claims Case No..09-865C, April 3, 2013, LAKESHORE ENGINEERING SERVICES, INC. vs. U.S. at http://www.uscfc.usc...SHORE040313.pdf

Lakeshore was the winner (loser?) of a Lowest-Priced, Technically Acceptable (LPTA) Job Order ID/IQ contract at Ft. Rucker, AL.in 2006. In 2009, the Contractor submitted a claim for losses allegedly incurred during the base and first option year, using the JOC contract pricing scheme. The contract pricing methods and associated risks are described in detail in the Decision.

Vecchia's last comment asked me what the benefit is of using such a scheme. I won't defend or condemn the pricing method or the details of the contract type. It was developed in the 1980's as a method to be able to quickly award a variety of task orders on a Single Award, Task Order Contract (SATOC) for minor construction, repairs, etc. Since there is no competition for task orders on a SATOC, it was necessary to streamline the individual task order negotiation process.

I understand that JOC contract has been widely used for Army Installations. The Air Force has widely used the "SABER" type contracts, which had some similarities to the JOC contracts.

Back in the mid 1990's I was assignerd to manage the source selection process for a couple of these type contracts. The price competition was extremely fierce with a bunch of proposers (perhaps 10 or more?). I was surprised to see that many of the proposed price coefficients to be applied to the bare unit prices in the estimating guides back then were less than 1.0 (something like .8 to .95 range).

I don't know for sure but do think I remember that the Army Installations made some awards themselves. The Installations often, if not commionly, administered the JOC contracts themselves. It required a specialized, trained staff to develop, manage, negotiate and administer task orders.

In the late 1990's, we were developing MATOC's as an alternative for some installations, due to complaints by industry and the Installations about problems with the JOC contracts, such as contractors' reluctance in performance of task orders due to high price risk, contractors having to maintain fixed staff, a wide variability in availability of funding to issue T.O's, etc.

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Joel,

Thanks for the reply. I think the key here is "a specialized, trained staff to develop, manage, negotiate and administer task orders", which to me seems a bit much given the atmosphere in Government contracting today. I remember the team that managed the BOS/JOC contract at Ft Benning, a team of three individuals, who spent months at a time merely administering the Award Fee determination, including negotiations with both the contractor and the base representatives. I just don't understand why an office would intentionally seek to use a process that required such specialized and trained staff when simpler methods are available to accomplish the same task.

My reasonings for that conclusion is that Government contracting is getting more bureaucratic by the day, more burdened with processes, paperwork and hoops to jump through, and expected to do all that without any increase in staffing or even reductions in staffing. Sooner or later there will be a breaking point, where offices cannot spend inordinate amounts of time on complicated processes because they will not have the staff to manage those tasks in the timeframes they are given. I believe that the time to prepare for an era where doing more with less is squared and cubed, and we will have to do things in the most common sense way, kinda a KISS principle thing.

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...I just don't understand why an office would intentionally seek to use a process that required such specialized and trained staff when simpler methods are available to accomplish the same task.

...I believe that the time to prepare for an era where doing more with less is squared and cubed, and we will have to do things in the most common sense way, kinda a KISS principle thing.

What do you recommend? Utilizing task orders on MATOC's? Someone still has to develop scopes of work and put them into some type of format to procure a vehicle to execute.

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Guest Vern Edwards

Someone still has to develop scopes of work and put them into some type of format to procure a vehicle to execute.

Joel:

Didn't you mean statements of work instead of "scopes of work"?

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Guest Vern Edwards

For those who may not know, Joel is talking about a "Job Order Contract" (JOC). A JOC is a type of IDIQ contract for construction work. The Army's regulations for the use of "Job Order Contracts" are in Army FAR Supplement (AFARS) 5117.90. This type of contract has been around for a very long time.

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Joel:

Didn't you mean statements of work instead of "scopes of work"?

Vern, I was actually referring to identifying the scope of neccessary work to be performed, which eventually becomes a statement of work in one of many, various formats. Thanks for the clarification, however.

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What do you recommend? Utilizing task orders on MATOC's? Someone still has to develop scopes of work and put them into some type of format to procure a vehicle to execute.

When I was working for NAVFAC, we used a database of previous contracts for construction projects to assist us in determining the IGCE for work. We also checked those estimates against a commercially available tool that conglomerated the wage information, cost of supplies and building materials and other economic factors into a fairly easy to use system to logic check our estimates.

To pay for the work, we simply verified that the invoice line items were linked to the contract clins, were allocable and allowable, and matched the project schedule associated with the contract. We also performed site visits with the invoice in hand to link invoice amounts to specific work, making sure that the work was done, accepted and that any punch list items were accounted for.

When it comes to your office, I cannot recommend any particular methods since I am not familiar with your systems, agency regulations or office procedures. It just seems to me that a system that appears (based on your description), to be at least 20 years old, is ripe for a revisit. Based on your comments along with the blog article, the contractor community would likely agree that it should be updated. If I were the leader in your organization, I would sit down with some of that contractor community and let them help me investigate a better way to price contract actions and make payments for work accomplished. A lot has changed in the last 20 years, so I would bet that better systems and new software is available that would be better for the both the contractors and the Government.

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vecchia, let me clarify that a Job Order Contract is only one of many types of contracts being used by the Army for Installation Support contracts. A JOC contract is a single award task order ID/IQ contract ("SATOC"). Since there is no competition for individual tasks in a SATOC, there must be a method to establish/negotiate prices for each task. The Air Force has also used a contract type with some similarities to JOC, called "Simplified Acquisition of a Base Engineering Requirements" ("SABER"). You said " simpler methods (than JOC) are available to accomplish the same task." What did you mean a- what are some of these simpler methods?

The NAVFAC procedures you described relate to developing estimates and paying for work performed under some unstated type of contract. What you described isnt anything unique or unusual. What you didn't discuss is what "simpler methods" you did use or would use to procure the type of construction services that a JOC contract is used for. If using a SATOC, for instance, how do you negotiate or otherwise establish the price for task orders? Or do you compete each task or project? If so, what contract type did you use or are you using?

Thanks.

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Sorry to get off topic, but there was something in the original post that I found irresistable.

In the mid 80s, when I was working in Germany, there was an American attorney who represented German firms in contract claims. He was perhaps the biggest horse's pattoot I have ever known, but that is beside the point. He once wrote a letter to the "contracting oafficer" (a term which, alas, bore a close resemblance to the truth). I have since been on the lookout for for other interesting typos (at least I hope they are typos). I think I have found one.

Joel's post says: "Back in the mid 1990's I was assignerd ...." Joel seems to be a very interesting fellow, and I hope his self image improves.

Back to being on topic.

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vecchia, let me clarify that a Job Order Contract is only one of many types of contracts being used by the Army for Installation Support contracts. A JOC contract is a single award task order ID/IQ contract ("SATOC"). Since there is no competition for individual tasks in a SATOC, there must be a method to establish/negotiate prices for each task. The Air Force has also used a contract type with some similarities to JOC, called "Simplified Acquisition of a Base Engineering Requirements" ("SABER"). You said " simpler methods (than JOC) are available to accomplish the same task." What did you mean a- what are some of these simpler methods?

The NAVFAC procedures you described relate to developing estimates and paying for work performed under some unstated type of contract. What you described isnt anything unique or unusual. What you didn't discuss is what "simpler methods" you did use or would use to procure the type of construction services that a JOC contract is used for. If using a SATOC, for instance, how do you negotiate or otherwise establish the price for task orders? Or do you compete each task or project? If so, what contract type did you use or are you using?

Thanks.

Joel,

NAVFAC avoided single award task orders starting well before it became widely practiced and set up multi-award, multi-contractor ID/IQ contracts that allowed for competition. The contracts were set up with pools of contractors for nearly every kind of work that NAVFAC did, from environmental remediation, military construction, commercial construction and speciality projects such as trailer renovation (the Navy had a lot of trailers but was not allowed to buy anymore, hence the need for trailer renovation). Most types had pools of small businesses and large businesses that could be either set aside or grouped together. In cases where a new requirement arose where there was not a pool of contractors that fit that requirement, we would either compete the requirement like any other office would or if time was available, as a seed project for a new multi-award/multi-contractor ID/IQ contract.

In cases where a major modification to an existing contract was needed, or a sole source award was approved, NAVFAC used their database of existing labor rates, the hours needed to build structures of a given number of stories, square feet, etc., and also bounced that information off of commercial databases that reported on economic factors such as the costs of construction materials, labor shortages in local and regional areas, and other information. NAVFAC also encouraged its PMs and contracting folks to learn and conduct serious cost analysis, much more so than in any other office I have worked in. It was a good system, many times we on the Government side knew just as much as the contractor did on what their company was paying for their materials and labor.

I am not saying that the system used by ACE is wrong, I just think that it may be time for a review of that system and based on that review, there may be some opportunities for improvement. I get the feeling that the contractors and perhaps even those in ACE believe that is true as well.

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Thanks for the update, vecchia. I believe that MATOC 's for such work can be good alternatives to JOC/SABER. In addition to the price risk exacerbated by the intense competition to win a JOC contract, MATOC pool contractors aren't required to provide full time, on-site presence in the anticipation of an unknown workload. If anyone here has worked with JOC or SABER contracts, what is your experience with them? Thanks in advance.

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Guest Vern Edwards

Joel,

NAVFAC avoided single award task orders starting well before it became widely practiced and set up multi-award, multi-contractor ID/IQ contracts that allowed for competition. The contracts were set up with pools of contractors for nearly every kind of work that NAVFAC did, from environmental remediation, military construction, commercial construction and speciality projects such as trailer renovation....

It was a good system....

What was good about it? Good in comparison to what? How so?

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What was good about it? Good in comparison to what? How so?

Vern, I believe that vecchia's reference to a "good system" was regarding the methods they used to negotiate sole source task orders/contracts or modifications to task orders on their MATOC contracts.

He began his 2nd paragraph thusly (emphasis added):

"In cases where a major modification to an existing contract was needed, or a sole source award was approved, NAVFAC used their database of existing labor rates, the hours needed to build structures of a given number of stories, square feet, etc., and also bounced that information off of commercial databases that reported on economic factors such as the costs of construction materials, labor shortages in local and regional areas, and other information. NAVFAC also encouraged its PMs and contracting folks to learn and conduct serious cost analysis, much more so than in any other office I have worked in. It was a good system..."

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Guest Vern Edwards

Thanks, Joel, but I want to hear from the old goat, if you don't mind. He obviously thinks the entire system was good, not just the part about major modifications.

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Vern,

I believe the entire system at NAVFAC SW Division office in San Diego was a good system. It supported the field 1102's with a variety of tools to assist and standardize processes without adding to bureaucratic burdens, provided a clear distinction between procurement and adminstrative contracting, supported true price and cost analysis activities, and enhanced the relationship between 1102's and the PM through matrixed teams that were co-located. In my office, I sat two cubes down from my PM so we could talk face to face within 5 steps from each others desk. No other office has done as well in those areas, an example is my current PM's are either on a diffent floor of a 12 story building or in another city altogether and much less available for close working collaboration.

The MATOCS helped by allowing competition within previously qualified contractors that in turn allowed for more efficient solicitations. We already knew the prevaliing rates, so we could focus on performance; who could do a better, faster or less expensive job. All we had to do is make sure our solicitation packages reflected those characteristics. The data we collected from each award added to our market research database, which by the time I arrived at NAVFAC was already very robust. For example; I could track how much a Project Engineer specializing in Environment Remediation for a high/medium/low compexity project would cost through the previous 5 years very easily. The commercial tools they provided were excellent, and were used extensively by the PM and 1102 staff to estimate pricing and to evaluate pricing. No other office I have worked in (6 offices in my anecdotal experience), has used those tools and methods as well or at all, nor have they substituted another tool or method to accomplish those tasks as well.

Overall, the system at NAVFAC SW Div was the best I have ever worked in. The leadership was outstanding, the workforce was the most enthusiastic and happy that I have worked with in all of my contracting jobs, and the location in San Diego is heavenly (with a price tag that reflects that status unfortunately). The only reason I am not there today is my better half does not like living California, so here I am on the East Coast.

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Guest Vern Edwards

Thanks for the response.

I suspect that multiple award task order contracts (MATOCs) are a huge waste of time and money for the most part. The CO must conduct a competition to award the contract and then conduct competitions to award orders under the contract. In light of the complexity of the rules in FAR 16.505, which is longer than FAR Subpart 15.3 (3,363 words versus 2,797) and the general cost of preparing task order proposals, how is MATOC competition more efficient and economical than simply using streamlined processes to award contracts for each project? Now, you might say that it's harder and more time-consuming to award a new contract than to award a task order, but my response would be that that is because most organizations use needlessly complex award processes.

Do MATOCs save time and money? What are the data? That's just a rhetorical question, because I suspect that there isn't any. Assessments of acquisition processes are generally based on dogma, unsystematic observation, and anecdote.

This is just a general observation. It is not meant to be a critique of your comments in this thread.

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Vern,

I don't disagree with you as you have much more experience than I do in observing how organizations administer their contracting profession. I can only base my opinion on what I have seen, which is pretty dismal currently. An example of how bad things are is in how long it takes to award contracts and simple delivery/task orders these days. The latest major award in my office for an Multi Award (3 contractors) ID/IQ contract took two years to accomplish. Basic DO/TOs are taking up to 6 months and rarely less than 3 months to award. Using NAVFACs system those activities took at least 1/3 less time, and in some cases less than 1/2 as much time. My current environment is IT contracting and NAVFAC was in a contstruction/environmental remediation environment, which I see as relatively equal in complexity. Perhaps my experience is not the norm, but I saw similar trends in my last office, which as a training and simulation acquisition center.

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Guest Vern Edwards

Oh, my! From construction, which is one of the most interesting and fun of all kinds of contracting, to IT, which is the most dismal. You have my sympathy.

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