Panelists Discuss Pros, Cons Of New Strategic Sourcing Push

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Executive Briefing: May 23, The Future of Multiple Award Contracts Bloomberg Government, The Public Contracting Institute (PCI) and the Professional Services Council (PSC) have partnered to bring together leaders in Government and industry to discuss the important issues affecting the acquisition community. The United States Government, as the largest buyer in the world, spends more than $500 billion annually on goods and services. In a time of significant budget cuts and increasing pressure on the Government acquisition workforce to save costs, the need for Government and industry to collaborate and work together efficiently and effectively is essential. Through a series of briefings, this coalition will facilitate the coordination and communication between Government and industry on critical issues that have significant impact on how both parties … Continue reading →

Mastering the Art of Government Contracting —Why You Need the FAR

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One of my favorite movies in recent times is Julie and Julia.  I loved it because I love to cook and it told a wonderful story about a woman who decided to engage in a journey to cook every single recipe in Julia Child’s famous cookbook —  Mastering the Art of French Cooking.  Cook books are fabulous things. They provide step by step instructions on how to make delicious meals but many folks are intimidated by them. I personally think, if you can read, you can cook, and once you learn to cook, you learn to improvise and become creative in what you prepare for friends and family. A Cookbook for Government Contracting If there is a “cookbook” for government contracting, it’s certainly the Federal … Continue reading →

FAR 52.216-29, Time-and-Materials/Labor-Hour Proposal Requirements

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Non-Commercial Item Acquisition with Adequate Price Competition NOTE: This is the first in a three-part series on Time-and-Materials/Labor-Hour Proposal Requirements.  This Part 1 addresses non-commercial item acquisition with adequate price competition.  Part 2 will address non-commercial item acquisitions where there is not adequate price competition (FAR 52.216-30).  Part 3 will address commercial item acquisitions at FAR 52.216-31 (which must, by law, be awarded based on adequate price competition).    Applicability: As stated at FAR 16.601(f)(1), the solicitation provision at FAR 52.216 29 applies to Time-and-Materials/Labor Hour (T&M./LH) solicitations for non-commercial item acquisitions, where the price is expected to be based on adequate price competition.   Key Requirements: T&M/LH contracts provide for reimbursement to the contractor based on a fixed hourly rate for each labor category listed in the … Continue reading →

Afterthoughts: Flowdown Clauses

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What are the three most significant errors contractors make when dealing with flowdown clauses? 1) I think the first error is just having a blanket provision in the front;  a blanket clause that says wherever you see the term “Government” insert “prime contractor” and wherever you see the term “contractor” insert “subcontractor”  because a number of the clauses just don’t work well that way. 2) Incorrect drafting or not complete enough drafting of a disputes provision that gives both parties the opportunity to resolve disputes in a reasonably efficient way.   This entails drafting  two provisions.  One provision for when a subcontractor claims that the government has caused it to incur additional expenses and will need  the prime to sponsor the claim.  The other provision is for … Continue reading →

CAS 409 – Depreciation of Tangible Capital Assets (Part 3 of 3)

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*This is Part 3 of a 3-part blog.  Each part addresses the fundamental requirements and techniques for application related to the standard, and provides specific examples. Part 1 addressed the general requirements/techniques, as well as those related to determining the estimated useful life of a tangible capital asset. Part 2 addressed the areas of depreciation methods and the determination of estimated residual values. This Part 3 addresses the accounting for gains/losses, cost allocation, and accounting for assets acquired prior to the applicability of CAS 409. Background: This standard provides the criteria for assigning costs of tangible capital assets to cost accounting periods and for allocating such costs within such periods in an objective and consistent manner.  The basic concept is that the amount assigned to … Continue reading →

A Brief Note on the Pay-If-Paid Clause: An Occasional Thorn to US Government Construction Subcontractors

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Subcontractors bidding US government construction projects often find themselves subject to both mandatory and non-mandatory FAR clauses and provisions flowed-down from the prime contractor’s RFP, as well as the prime’s particular special terms and conditions – and conflicts often exist between the two.  Contract payment is one area where discrepancies abound between the FAR clauses and the prime’s own subcontract terms and conditions.  It cannot be stressed enough that, prior to bidding work, subcontractors must be able to recognize and understand the various payment provisions contained in subcontract RFPs.  Quite simply, for subcontractors, it’s all about the money and how fast they get it. Thus, the type of payment provision is extremely important to subcontractors.  To be sure, a subcontract RFP for a government construction … Continue reading →

Termination for Convenience Case at Court of Federal Claims May Have Far-reaching Effect

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The Court of Federal Claims issued a potentially very important decision in a Termination for Convenience case on April 2, 2013. In Tigerswan v. U.S., COFC 12-62C, Judge Firestone made a decision which could affect breach claims when the government acts in an illegal manner. With a number of potential terminations coming in the wake of sequestration, the nuances of this case may have a major impact. The Contractor alleged two bases for its breach of contract claim: 1. The government had breached the implied duty of good faith and fair dealing in its T for C decision; and 2. The government abused its discretion in the T for C decision, or it never intended to honor its contract. This is important because, generally, a … Continue reading →

FAR 52.215-16 AND FAR 52.215-17, Facilities Capital Cost of Money

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Applicability: These FAR solicitations/clauses address the allowability/reimbursement of facilities capital cost of money. FAR 52.215-16, Facilities Capital Cost of Money, is included in solicitations expected to result in contracts that are subject to FAR Subpart 31.2 (the cost principles for contracts with commercial organizations). FAR 52.215-17, Waiver of Facilities Capital Cost of Money, is included in the contract if the contractor receiving the award did not propose facilities capital cost of money in its offer.   Key Requirements: The solicitation requirement at FAR 52.215-16 and the contract clause at FAR 52.215-17 work in tandem to address the allowability of cost of money under the awarded contract. FAR 52.215-16 states that facilities capital cost of money will be an allowable cost under the contemplated contract, if … Continue reading →

Coast Guard’s Fat Requirements for Dry Suits All Wet Says GAO

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The Coast Guard issued a delivery order under a GSA Schedule contract to U.S.I.A. Underwater Industrial Apparel (“USIA”) for 777 underwater dry suits. USIA delivered the first 100 suits with an invoice for $59,000. The Coast Guard tested these suits and found they did not meet the specifications for an adjustable Velcro neck. After discussing the problem, the parties signed a bilateral modification “to change the delivery date, change the specification, and add a first article requirement.” The Coast Guard did not return the 100 suits to USIA. USIA then delivered 120 more suits with the new adjustable neckline. The Coast Guard again tested the suits and determined that 32.5% of the suits leaked. The Coast Guard then issued a cure notice for the delivery … Continue reading →

CAS 409 – Depreciation of Tangible Capital Assets (Part 2 of 3)

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*This is Part 2 of a 3-part blog. Each part addresses the fundamental requirements and techniques for application related to the standard, and provides specific examples. Part 1 addressed the general requirements/techniques, as well as those related to determining the estimated useful life of a tangible capital asset. This Part 2 addresses the areas of depreciation methods and the determination of estimated residual values. Part 3 will address the accounting for gains/losses, cost allocation, and accounting for assets acquired prior to the applicability of CAS 409. Background:  This standard provides the criteria for assigning costs of tangible capital assets to cost accounting periods and for allocating such costs within such periods in an objective and consistent manner.  The basic concept is that the amount assigned … Continue reading →