WHO IS THE MANUFACTURER IN A SMALL BUSINESS SET-ASIDE?

When a manufacturing or supply contract is set aside for small businesses, the Small Business Administration (“SBA”) size regulations require that the prime contractor either be the manufacturer of the end item being procured (and the end item must be manufactured or produced in the United States); or must comply with certain nonmanufacturer exceptions. 13 CFR § 121.406. A recent Size Appeal at the SBA Office of Hearings and Appeals (“OHA”) considered what type of actions by a company qualifies it as a “manufacturer.” Size Appeal of MPC Containment Sys., LLC and GTA Containers, Inc., SBA No. SIZ-5802, Jan 11, 2017. The Defense Logistics Agency was procuring collapsible fuel tanks, and set aside the procurement for small businesses in a North American Industry Classification System … Continue reading

ONE TRUTH ABOUT THE TRUTH IN NEGOTIATIONS ACT

The Truth in Negotiations Act (“TINA”) requires that contractors furnish cost or pricing data before an agreement on price for most negotiated procurements of more than $750,000. Cost or pricing data mean all facts that a prudent buyer or seller would reasonably expect to significantly affect price negotiations, and that were available at the time the contract price was agreed to. This data (which is factual and verifiable, such as vendor quotes, nonrecurring costs, unit cost trends—but not estimates or projections) must be certified by the contractor as “accurate, current and complete.” The government uses the data to determine price reasonableness, and you can easily see how a contract price that relied on a subcontractor quote could be significantly reduced, based on the contractor’s furnishing … Continue reading

DISCRETION OF THE SOURCE SELECTION AUTHORITY TO CHANGE RATINGS

Negotiated procurements conducted pursuant to Federal Acquisition Regulation (“FAR”) Part 15 are structured with one Source Selection Authority (“SSA”), who acts on behalf of the Agency head in making a source selection. (Remember: the U.S. Code provides, and FAR 1.601(a) repeats that “[u]nless specifically prohibited by another provision of law, authority and responsibility to contract for authorized supplies and services are vested in the agency head.”) The FAR provides as follows: FAR 15.303 Responsibilities. (a) Agency heads are responsible for source selection. The contracting officer is designated as the source selection authority, unless the agency head appoints another individual for a particular acquisition or group of acquisitions. (b) The source selection authority shall— Establish an evaluation team, tailored for the particular acquisition, that includes appropriate … Continue reading

The PCI Network – Biggest Challenge and Important Consideration During an Audit

This episode of The PCI Network focuses on important considerations and challenges during an audit with Bill Walter, Director and Faculty at PCI. Bill Walter is a Partner with Dixon Hughes Goodman, LLP.  He holds a BS degree in Accounting from Penn State University and has more than 25 years of experience in cost accounting and financial management systems.  He has an extensive background in the application and interpretation of rules, regulations, and standards applicable to Government contractors, including the Federal Acquisition Regulation, individual agency supplements to the FAR, the Truth in Negotiations Act and the Cost Accounting Standards.  He began his career as an auditor for the Defense Contract Audit Agency (DCAA), where he was responsible for implementing micro-computers and training his fellow auditors and … Continue reading

UNREASONABLE LIMITATIONS ON PROPOSAL REVISIONS DURING THE CORRECTIVE ACTION PHASE OF PROTESTS

In what appears to be a first, the Government Accountability Office (“GAO”) sustained a protest because an agency imposed unreasonably restrictive limitations on the scope of proposal revisions. In this protest, Deloitte Consulting, LLP, B-412125.6, Nov. 28, 2016, GAO held that the restrictions prevented offerors from revising proposal information that had been materially impacted by the corrective action. Deloitte protested the corrective action of the Defense Health Agency (“DHA”), taken in response to Deloitte’s prior protest of the award of a contract to another vendor for DHA’s governance, requirements and architecture management support. In its earlier sustained protest of this procurement, Deloitte alleged that DHA had conducted an unreasonable evaluation of the key personnel resumes under the staffing approach subfactor, and had unreasonably evaluated past … Continue reading

CONSTRUCTIVE ACCELERATION

Constructive acceleration occurs when the government demands the contractor’s compliance with an original contract deadline even though there is excusable delay. This is precisely what happened in IAP Worldwide Svcs, ASBCA no. 59397 et al, May 17, 2017. A contractor is entitled to compensation for additional costs that result from the constructive acceleration. In IAP, the Army Corps of Engineers issued three delivery orders to provider power plants at forward military bases in Pakistan. The delivery orders incorporated IAP’s proposal which made it clear that IAP would ship the power plants via surface transportation, using what was called the “Pakistan route.” Before the shipments were due, in response to U.S. combat operations, Pakistan closed the Port of Karachi and the land routes from that city … Continue reading

CONTRACTOR CAN SEEK PAYMENT FOR WORK THAT WAS INVOICED AND ACCEPTED PRIOR TO DEFAULT TERMINATION

Claude Mayo Construction Company, Inc. (“Mayo”) had a contract with the General Services Administration (“GSA”) to renovate a U.S. Attorney’s Office in Syracuse, NY. Before Mayo completed the project, GSA terminated the contract for default. Mayo sought to overturn the default, which is not the subject of this appeal. However, Mayo also sought damages for a breach of contract because GSA, without basis, failed and refused to pay Mayo for work completed and accepted by GSA prior to the default termination. Claude Mayo Const. Co., Inc., No. 15-1263C (Fed. Cl. June 23, 2017). GSA sought to dismiss the breach of contract, asserting failure to state a claim. The government alleged that Mayo failed to identify a duty arising from the contract or a breach of … Continue reading

WRITTEN FINAL PROPOSAL REVISIONS ARE NOT REQUIRED IN COMPETITIONS FOR TASK ORDERS

In a recent bid protest decision, the Government Accountability Office (“GAO”) made clear that when agencies conduct competitions for task orders among holders of a multiple award contract, final proposal revisions (“FPR”) are not required, as they would be for a “normal” Federal Acquisition Regulation (“FAR”) Part 15 procurements. These task order competitions are held under the less stringent FAR Part 16 requirements. SSI, B-413486 et. al, Nov. 3, 2016. The protester here, Mid Atlantic Professionals, Inc., d/b/a SSI, was one of several multiple awardees for language, regional expertise and cultural instruction for Special Forces. The Agency (U.S. Special Operations Command) held discussions with both of the offerors. The agency found that SSI had adequately addressed the 11 issues that were identified in its proposal, … Continue reading

A COMMON SENSE ANALYSIS OF WHAT IS A CLAIM

How many contractor demands for payment make a claim? The Contract Disputes Act (“CDA”) requires that “each claim by a contractor against the Federal Government relating to a contract shall be submitted to the contracting officer for a decision.” 41 U.S.C. § 7103(a)(1). The Federal Acquisition Regulation (“FAR”) includes the same requirement at FAR 33.206. While the CDA itself does not define claim, the FAR does, as follows: “‘Claim’ means a written demand or written assertion by one of the contracting parties seeking, as a matter of right, the payment of money in a sum certain, the adjustment or interpretation of contract terms, or other relief arising under or relating to the contract. However, a written demand or written assertion by the contractor seeking the … Continue reading

RE-RECURRING AGENCY MISTAKES IN DISCUSSIONS

About a year ago, this blog published two articles on discussions, “Six Recurring Agency Mistakes in Discussions” and “Once Again: Recurring Agency Mistakes in Discussions.” (May 2016.) The “number 1” mistake was: Agencies must conduct meaningful discussions. When conducted, discussions must be meaningful. That is, discussions must identify deficiencies and significant weaknesses in an offeror’s proposal that could reasonably be addressed so as to materially enhance the offeror’s potential for receiving award. It seems that this mistake doesn’t just recur, it re-recurs frequently, most recently in Mevacon-NASCO JV; Encanto Facility Servs., LLC, B-414329 et al., May 11, 2017. Mevacon is a long and complex protest involving the evaluation of an Army Corps of Engineer contract for real property services at Fort Hood, Texas. The protesters … Continue reading