FAC 2005-02 is out

Federal Acquisition Circular 2005-02 Check it out at WIFCON
Introduction. (Published March 23, 2005)

Service-Disabled Veteran-Owned Small Business Concerns Procurement Program. (Published March 23, 2005)

Small entity compliance guide. Published March 23, 2005)

Department of Defense

Contract modifications. Published March 23, 2005)

Foreign acquisition. (Published March 23, 2005)

Major systems acquisition. (Published March 23, 2005)

Component breakout. (Published March 23, 2005)

Contracting by negotiation. (Published March 23, 2005)

Contractor performance of acquisition functions closely associated with inherently governmental functions. (Published March 23, 2005)

Testing program for negotiation of comprehensive small business subcontracting plans; extension. (Published March 23, 2005)

Contractor performance of security-guard functions. (Published March 23, 2005)

Totally enclosed lifeboat survival systems; restrictions. (Published March 23, 2005)

Technical amendment. (Published March 23, 2005)

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Small Business Administration

Service-disabled veteran-owned small business concerns. (Published March 23, 2005)

Iraq Reconstruction

Interesting article in the San Francisco Chronicle about construction contracts in Iraq.

Iraq ministries are refusing to make payments on contracts turned over to them by the Coalition Provisional Authority (CPA) because of a lack of paperwork from the CPA. Bloomberg.com

Blog improvements and Useful GAO Reports

As you see I have discovered the ability to put links into the blog format. I want to limit the number to the ten most useful links to contracting specialists. I have a start, but I solicit your suggestions as to other links to incorporate; just drop me an email or reply to this post. Also, if you are aware of any other blogs addressing federal government contracting, please let me know. Thanks

The GAO publishes many reports that should be of interest to the acquisition community. Unfortunately who has time to read them all. But all is not lost. In addition to being able to subscribe to updates, it is possible to just look at the "highlights," and decide whether you want to read the entire report. For an example click on: CONTRACT MANAGEMENT: Opportunities to Improve Surveillance on Department of Defense Service Contracts. From within the abstract or highlights you can click to get the whole report. There are indexes to search for past reports.

DEFENSE FAR SUPPLEMENT (DFARS) Change Notice 20050222

This is the new DFAR change notice form the DPAP office.

DoD published the following changes and proposed changes to the DFARS on February 22, 2005 :

Interim Rule :

Provision of Information to Cooperative Agreement Holders (DFARS Case 2004-D025)

Increases, from $500,000 to $1,000,000, the threshold at which DoD contracts must include a requirement for the contractor to provide to cooperative agreement holders, upon their request, a list of the contractor's employees who are responsible for entering into subcontracts. Amends the prescription for use of the clause at DFARS 252.205-7000, Provision of Information to Cooperative Agreement Holders, to reflect the new dollar threshold. This change implements Section 816 of the National Defense Authorization Act for Fiscal Year 2005.

Affected subparts/sections: 205.4


Final Rules :

Government Source Inspection Requirements (DFARS Case 2002-D032)

Eliminates Government source inspection requirements for contracts or delivery orders valued below $250,000, unless mandated by DoD regulation, required by a memorandum of agreement between the acquiring department or agency and the contract administration agency, or determined necessary by the contracting officer because of the technical nature and criticality of the item being acquired. The objective is to focus diminishing contract management resources on high-risk areas, while providing flexibility for exceptions where needed.

Affected subparts/sections: Part 246 Table of Contents; 246.4

Resolving Tax Problems (DFARS Case 2003-D032)

Relocates text to the new DFARS companion resource, Procedures, Guidance, and Information (PGI), available at http://www.acq.osd.mil/dpap/dars/pgi. The relocated text contains guidance on resolution of tax issues and information on tax relief agreements between the United States and foreign governments.

Affected subparts/sections: 229.1; PGI 229.1


Bonds (DFARS Case 2003-D033)

Updates DFARS text on the use of bonds for financial protection against losses under DoD contracts. The change clarifies that fidelity and forgery bonds are authorized for use when necessary for protection of the Government or the contractor or when the investigative and claims services of a surety company are desired.

Affected subparts/sections: 228.1



Technical Amendment :

Corrects typographical errors in the headings of DFARS sections 209.270-3 and 209.270-4.

Affected subparts/sections: 209.2

Proposed Rules :

Acquisition of Ball and Roller Bearings (DFARS Case 2003-D021)

Proposed change improves the clarity of domestic source restrictions on the acquisition of ball and roller bearings by addressing only the exceptions, waivers, and waiver authority available to the contracting officer under current law; and by making the restrictions inapplicable to bearings that are commercial components of non-commercial end items or components.


Specialized Service Contracting (DFARS Case 2003-D041)

Proposed change relocates to PGI, procedures for defining the geographic area to be covered by mortuary services contracts, and procedures for distribution of those contracts; deletes a contract clause containing facility requirements for mortuary services, as these requirements are adequately addressed in State law; and deletes unnecessarily restrictive text on contracting for laundry and dry cleaning services.



Advisory and Assistance Services (DFARS Case 2003-D042)

Proposed change deletes a definition of advisory and assistance services that is used primarily for budgeting and reporting purposes and is adequately addressed in financial management regulations; deletes obsolete text on contracting for engineering and technical services and requesting activity responsibilities; and relocates to PGI, a list of DoD publications that govern the conduct of audits.


Acquisition of Telecommunications Services (DFARS Case 2003-D055)

Proposed change revises DFARS text on the acquisition of telecommunications services to update terminology, delete obsolete text, and add text addressing DoD's authority to enter into contracts for telecommunications resources. Adds to PGI, historical documents on delegated authority from the General Services Administration for the procurement of communications services.

Acquisition of Utility Services (DFARS Case 2003-D069)

Proposed change deletes DFARS text on the use of competitive procedures and delegated authority to acquire utility services, as these issues are adequately addressed in the FAR; deletes obsolete text on preaward contract reviews; and relocates to PGI, procedures and corresponding definitions related to connection charges and award of separate contracts for utility services.


Utility Rates Established by Regulatory Bodies (DFARS Case 2003-D096)

Proposed change clarifies that utility rates established by independent regulatory bodies may be relied upon as fair and reasonable; and clarifies requirements for use of contract clauses addressing changes in rates for regulated and unregulated utility services.


These changes are available at the Defense Procurement and Acquisition Policy DFARs page.

New Blog Capabilities

I have added some enhancements to the ProfRex blog in order to, I hope, make it more useful and easier to spread information. You can now submit comments to the postings and you can also email the particular posting to friends and associates. I particulalry like the email option because it allows us to quickly share information within our offices.

Air Force Policy on Electives

The Deputy Assistant Secretary (Contracting), the Assistant Secretary (Acquisition), has issued the Acquisition Professional Development Program (APDP) Elective Policy on what will satisfy the elective requirements for certification training.

New Community of Practice at DAU ACC

The Acquisition Community Connection (ACC), Contract Management Community of Practice (CoP) has been revitalized and should be a very valueable tool for those seeking contracting information. The new CoP is titled "Mission Support Contracting." I strongly encourage signing up for the ACC as it is a good information source. Sign up is easy and free.

Here is a short note announcing the change:

The Contract Management Community of Practice (CoP) Gets a Face Lift - the CoP has been completely redesigned to better support the contracting community and business advisor. First off, the community has changed its name to Mission Support Contracting (MSC) which aligns itself with the supporting contracting curriculum restructuring and includes new mission and process areas. Secondly, the new MSC CoP highlights the current “hot topics” in the contracting field as well as provides a tool for Industry feedback - Industry Feedback Forum. New topics that have been added include leasing, government property, and construction contracting to name a few. Check back often as new mission and process areas are being developed which include 1102 workforce issues and finance and payment information. We solicit your feedback as well as ideas for other mission and process areas - are you interested in sponsoring a mission and process area? E-mail msc@dau.mil

The Week of 7 March -- much good stuff

Federal Acquisition Regulation
Federal Acquisition Circular 2001-28 is out.
Find it at WIFCON.

Have you ever gotten one of those actions to contract for a conference or high level meeting. The question always arises; can you use government funds to pay for food and drink and can you charge a registration fee. The Comptroller General (CG)has issued a decision. In National Institutes of Health -- Food at Government-Sponsored Conferences, B-300826, the CG lays out the rules. As always the answer is -- it depends. A must read.

The other shoe drops. In Lockheed Martin Aeronautics Company, et. al., B-295401 et. seq., February 24, 2005, the GAO deals with the remainder of the Darlene Druyun influence issues. GAO sustained all the protests. GAO synopsis.

1. Where a senior procurement official who functioned as the source selection authority has acknowledged bias in favor of the awardee, and was materially involved in the evaluation of proposals, indicating during the evaluation process that she believed the awardee's technical ratings should be raised in various areas and that the protesters' technical ratings should be lowered in various areas, the protests are sustained based on the agency's failure to demonstrate that the senior official's acknowledged bias did not prejudice the protesters and that the integrity of the procurement process was not compromised.

2. Protests are sustained where, following submission of final proposal revisions, the agency reopened discussions in order to permit the ultimate awardee to address an aspect of its proposal that was contrary to instructions previously given by the agency during discussions, but failed to identify similar concerns with the proposals of the protesters.

In another case, Keeton Corrections, Inc., B-293348, GAO sustained a protest finding that the information conveyed to the source selection authority (SSA) was inaccurate. GAO synopsis:

In a negotiated procurement, which provided for award on the basis of a cost/technical tradeoff and under which past performance was stated to be the most important evaluation factor, the selection of the awardee's significantly higher-priced offer based upon that firm's technical superiority and better past performance was unreasonable, where the information provided to the source selection authority to support the awardee's and protester's past performance evaluation did not accurately reflect the firms' evaluation but instead erroneously conveyed the impression that the awardee had no evaluated past performance weaknesses and that the protester's past performance had nearly only weaknesses.

OTHER INTERESTING INFORMATION

David Safavian, the new director of OFPP, stated at his recent confirmation hearing that shaping the acquisition workforce was a top priority.

Two congressmen have announced they are investigating contracts awarded to Alaska native corporations.

Two interesting articles as found on the WIFCON analysis page are worth your time to read. WIFCON sysnopsis:

Organizational Conflicts of Interest: A Growing Integrity Challenge
By Daniel L. Gordon

Courtesy of the Social Science Research Network

Conflicts of interest involving government officials have been very much in the news in recent years. At least in the United States, public procurement professionals are encountering more and more instances of a more particular kind of conflict, organizational conflicts of interest (OCIs), which can be defined, initially, as situations where an entity plays two or more roles that are, in some sense, at odds with one another. This article endeavors to set out some points for consideration in this increasingly important area. (February 2005)

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Emerging Policy and Practice Issues
By Steven L. Schooner and Christopher R. Yukins

Courtesy of the Social Science Research Network

That was the year that was. In this item, the authors share a paper that they presented at the West Government Contracts Year in Review Conference. The article covers a variety of issues including certain federal contracting scandals, task order contracting, and share-in-savings contracting. (February 2005)

As always, I encourage you to use the DAU Continuous Learning Center and the DAU Acquisition Community Connection(ACC), as additional resourcers for current information.

The Last of the GAO Cases for Now

Don't let this happen to you. In Unversity Research Company, LLC, B- 294358, GAO sustained a protest finding that:

In addition, we think the effect of the CO’s actions on this procurement weigh against her continued involvement in this matter.8 Therefore, we recommend that HHS use a different selection official to prepare the new selection decision. If the new source selection decision determines that an offeror other than IQ offers the best value to the government, HHS should terminate IQ’s contract for the convenience of the government and make award to the successful offeror.

GAO synopsis:

Protest challenging the adequacy of a source selection decision is sustained where the selection official ultimately conceded that she knowingly mischaracterized in the source selection document the award recommendation of agency project officers, whose participation in the evaluation of proposals is anticipated by the agency’s acquisition regulation--i.e., she wrote that the project officers recommended award to the awardee, when, in fact, they recommended award to the protester--and, as a result, she fails to state any basis for rejecting their award recommendation. Without documentation in the record explaining the basis for rejecting the input of the project officers, the Government Accountability Office has no basis for determining whether those actions were reasonable.

FINALLY -- what happens when we do not do it right!

In the first case growing out of the Darlene Druyun case, Lockheed Martin Corporation, B-295402, GAO sustained the protest involing an acquisition action which occurred in 2001. Referring to the obvious timeliness issue, GAO stated:

As a procedural matter, our Office's timeliness rules generally preclude consideration of protests challenging agency actions, such as these, that occurred in the relatively distant past. See Bid Protest Regulations, 4 C.F.R. 21.2 (2004). Here, however, Lockheed Martin's protest is based on information it first obtained in October 2004 due to the public disclosure at that time of documents relating to Darleen Druyun's criminal conviction and sentencing for violation of the conflict of interest provisions codified at 18U.S.C. 208(a) (2000). [3] Since Lockheed Martin had no reason to previously know of the information disclosed in those documents, we view the protest as timely.

The GAO went on to find that:

The Federal Acquisition Regulation (FAR) provides as follows:
Government business shall be conducted in a manner above reproach and, except as authorized by statute or regulation, with complete impartiality and with preferential treatment for none. Transactions relating to the expenditure of public funds require the highest degree of public trust and an impeccable standard of conduct. The general rule is to avoid strictly any conflict of interest or even the appearance of a conflict of interest in Government-contractor relationships.

Later:

As noted above, where, as here, the record establishes that a procurement official was biased in favor of one offeror, our Office believes that the need to preserve the integrity of the procurement process requires that the agency demonstrate that the protester was not prejudiced by the procurement official's bias in order for our Office to deny the protest. Here, in defending against Lockheed Martin's protest, the agency has maintained that Druyun had no significant involvement or influence in the agency's decisionmaking process leading up to the May 2002 changes and, further, that only the ACC, the user community--not the acquisition community of which Druyun was a part--was in a position to make determinations regarding the contract requirements. As discussed above, the record in this case does not provide persuasive support for either position. [31]

In my view this case is "must" reading for all acquisition officals.

Even More GAO Cases

There is a lot of discussion about the authority to "Bundle" requirements. In Health & Human Services Group, B-294703, The GAO denied a protest against bundling and upheld the combination of two requirements into one solicitation. GAO did limit its consideration to bundling under the Small Business Act and not the Competition in Contracting Act.

In the final analysis, the solicitation requires the contractor to furnish two separate sets of personnel, one to perform EAP services that require confidentiality, and a second to perform DFWP services that require disclosure of testing information; the mere fact that the contractor is providing both sets of employees does not, in and of itself, present a potential conflict in light of the RFPs safeguards relating to the location of these personnel and their records (as well as the EAP personnels confidentiality obligations). There thus is no basis to conclude that combining the two functions is improper.

In a case involving the evaluation of past performance, Cooperative Muratori Riuniti, B-294980, GAO sustained a protest where the agency did not provide a "reasonable" explanation for distinguishing between offeros' past performance. The case is somewhat lengthy but well worth reading for its analysis of what an agency must consider in distinguishing past performance.

GAO synopsis:

1. In evaluating proposals for construction work, agency has not provided a reasonable basis for distinguishing between offerors' experience in performing multiple projects at multiple sites under a single contract and offerors' experience in performing multiple projects at multiple sites under multiple contracts, particularly where solicitation called for performance at two separate work sites.

2. Protest against evaluation of past performance is sustained where record reveals that protester's past performance was re-rated by the evaluators on a different scale and in response to different questions than those posed to the references, and it is not clear that the new ratings were reasonably based.

3. Evaluators reasonably rated protester's proposed construction schedule as good, as opposed to excellent, where they determined that protester had offered an accelerated schedule, but had failed to offer evidence that it had thought through the implications of that schedule with regard to matters such as staffing.

GAO in MTB Group, Inc., B-295463, denied a protest against the use of a reverse auction in a simplified acquistion. The protestor had claimed that it resulted in the improper disclosure of price information.

GAO synopsis:

Protest that conducting procurement using reverse auction format is impermissible because vendors' prices will be disclosed during the auction is denied; agency is conducting reverse auction under simplified acquisition procedures, which encourage use of innovative procedures and do not expressly prohibit disclosure of vendors' prices in implementing such procedures, and disclosure is not prohibited under the procurement integrity provisions of the Office of Federal Procurement Policy Act.