Afterthoughts: Evaluating Cost & Price Realism

By Nicole R. Best On February 23, 2017, Professor Ralph Nash and Tim Sullivan hosted a virtual classroom on the topic of Evaluating Cost and Price Realism. Following the virtual classroom, I interviewed Professor Nash to ask questions related to the discussion during the training. Why does the government, as a buyer, care about cost and price realism? Those are two different things. Cost realism is important because when we are running a competition for cost reimbursement contracts, we don’t want companies to win by proposing an estimate that is unreasonably low. If the government awards at an estimate that is low and the contractor runs out of money on the contract but hasn’t finished the job, either (1) you won’t be able get money … Continue reading

Afterthoughts: Discussions versus Clarifications

By Nicole R. Best On March 30, 2017, Professor Ralph Nash and Tim Sullivan hosted a virtual classroom on the topic of Clarifications versus Discussions during negotiated procurements. Following the virtual classroom, I interviewed Professor Nash to ask questions related to the discussion during the training. To some extent a theme of the webinar was a discussion of the narrowing scope of what constitutes a clarification during the negotiated procurement source selection process. What exchange currently constitutes a clarification and, as a practical matter, do you think clarifications still have a significant and useful role in the negotiated procurement process? First, the narrowness of the definition is to some extent in the vagueness of the language. If you look at FAR 15.306(a) it says “Clarifications … Continue reading

Gift-Giving Policies: Seven Ethics Checks in Light of OGE’s Updated Standards

By Jayna Marie Rust If you have not updated your ethics and compliance program since November 18, 2016, dust it off and take a good look at it. November 18 was the day the U.S. Office of Government Ethics (“OGE”) issued a final rule that revised portions of the Standards of Ethical Conduct for Executive Branch Employees found at 5 C.F.R. 2635.[1]  The revisions modified and clarified the standards regarding Gifts from Outside Sources (“Standards”), which prohibit Executive Branch employees from soliciting and accepting gifts from “prohibited sources” as well as gifts given because of a Government employee’s official position. Because Government contractors and other regulated companies are almost always “prohibited sources,”[2] they should become familiar with the changes, which took effect on January 1.  … Continue reading

Fun with the DFARS Part 225

A “Qualifying Country” is a country from a list of twelve or fifteen countries with whose ministry of defense the DoD has a bilateral agreement for defense contracting only. This list is DoD-specific and does not apply to other agencies. End products from qualifying countries are not subject to the Buy American Act (“BAA”) because of the bilateral agreements. DFARS 225.0. The Berry Amendment at first related only to preference for U.S.-made textile or fabric products, such as uniforms or tents. Over time, it has grown away from only textiles to incorporate special interests such as bulletproof vests, fire-retardant fabrics, and hand tools. The Berry Amendment is at DFARS 225.7002. The Berry Amendment has several exceptions; for example, it generally does not apply to contracts … Continue reading

Fun with the DFARS Parts 219, 222, & 223

The first part of Subpart 219.2 can function as a guide for small businesses working on DoD contracts for what they should expect the contracting agency to do, since it contains the standards to which the contracting agency will be held. DFARS 219.201. Because of the Fair Pay and Safe Workplaces Executive Order, later this year or next year, contracting officers will have to ensure that prospective contractors have not violated certain federal labor laws or corresponding state labor laws within the past three years, or the contractors may risk serious problems including suspension/debarment, default, and certification issues. If there is a labor dispute of some type, contractors should notify their contracting officer immediately so they have the opportunity to explain the situation and prevent … Continue reading

Fun with the DFARS Parts 216, 217, & 218

If a contractor and contracting officer wish to use a cost-plus-award-fee contract, they must refer to DFARS Part 216.405-2 and PGI 216.405-2. In the wake of allegations of contractors being paid unearned award fees, contractors must be particularly careful to follow this guidance, or risk reduction or denial of their award in accordance with DFARS Part 252.216-7004. Multiyear contracts are best used when there are many long-lead items that would necessarily be included in execution of the contract. However, contracting officers must still ensure that there is an economic benefit in using a multiyear contract instead of an annual procurement approach, and often must provide at least 30 days’ notice to the congressional defense committees before entering into the multiyear contract. DFARS Part 217.170. The … Continue reading

Fun with the DFARS Part 215

Per DFARS Subpart 215.371-2, contracting officers must promote competition, especially in the context of receipt of only one offer. However, even if more than one offer is received, the prices offered are not automatically fair or reasonable. Thus, contracting officers must still perform a price analysis. PGI 215.402 sets out procedures for buying supplies and services at fair and reasonable prices. Contracting officers have a responsibility to ensure fair and reasonable prices in all situations, and offerors have a corresponding responsibility to provide any relevant data the contracting officer might need to determine a fair and reasonable price, per FAR 15.402(a)(2). Per DFARS Subpart 215.470, the Government cannot ask for data it already has. If certain data were already submitted to the Government under another … Continue reading

Fun with the DFARS Part 207

When a major system is developed exclusively at private expense, contracting officers are prohibited from requiring offers for development or production of those systems which would enable the Government to use technical data to competitively reprocure identical items or components of such systems. Per DFARS 207.5, unless there are certain extenuating circumstances, the Government may not contract out inherently governmental functions, such as command of military forces or the direct conducting of a criminal investigation. In certain circumstances and for compelling reasons, the Government may contract with a debarred or suspended contractor. Some examples of compelling reasons are:  only a debarred or suspended contractor can provide the supplies or services, urgency requires contracting with a debarred or suspended contractor, or the national defense requires continued … Continue reading