ACQUISITION SOURCES
AND
ALTERNATIVES
August 1998
Prepared by:
GENERAL SERVICES ADMINISTRATION
Emerging Information Technology Policies Division
Office of Information Technology
Office of Government-wide Policy
1800 F Street, NW.
Washington, D.C. 20405
FOREWORD
Program and project managers today are faced with a new and, until recently, a largely unimaginable problem – too many contracting choices. Today’s program/project manager has choices undreamed of several years ago. Selecting from micro-purchases with government credit cards, to new and improved GSA schedules and Blanket Purchase Agreements (BPAs), to literally hundreds of Governmentwide Agency Contracts (GWACs) and multiagency contracts, as well as traditional source selections, can be a daunting task. All this choice begs the question; which approach is the best for my requirement?
GSA’s Office of Information Technology, with assistance from both SIGNAL Corporation, and Acquisition Solutions, Inc (ASI), developed this white paper to help answer this question. It presents an overview of the predominant contracting sources and alternatives available to today’s program/project office. It differs from traditional discussions on this topic in that it does not focus on the Federal Acquisition Regulation (FAR) rules and directives. Instead, this white paper presents the contracting approaches from a program/project manager’s perspective. It does this by focusing the intent, advantages and disadvantages, and business perspective (e.g., overhead, risks, etc.) of each option. Information presented in this paper will help the program/project manager understand how various options and techniques can assist in achievement of program cost, schedule, and performance objectives.
The Acquisition Sources and Alternatives white paper is another in a series issued by the General Services Administration (GSA) that focus on key issues and important topics in the acquisition and management of information technology (IT) resources. Comments and/or suggestions for improving future versions of the Acquisition Sources and Alternatives white paper should be sent to:
U.S. General Services Administration
Emerging IT Policies Division
Attn: Richard N. Kellett, or David Middledorf
Room 2218, 1800 F Street, N.W.
Washington, DC 20405
We also welcome suggestions for topics to be covered in future white papers.
Acquisition white papers published to date, as well as additional information about Federal IT acquisition, are available on the IT Policy OnRamp: http://www.itpolicy.gsa.gov.
Dr. Joan Steyaert
Deputy Associate Administrator
for Information Technology
Office for Governmentwide Policy
U.S. General Services Administration
ACKNOWLEDGEMENT
GSA’s Office of Information Technology, wishes to acknowledge the efforts of GSA’s Emerging IT Policies Division, Acquisition Solutions, Inc., and SIGNAL Corporation, who conceived and developed this white paper. We believe it represents an important step in providing the IT program manager helpful, how to, information on selecting the most appropriate contract option.
GSA’s Office of Emerging IT Policies (MKE) identifies, addresses, and develops emerging business, management, legal, and technology issues. MKE disseminates timely and useful IT policies, guidance such as this white paper, and best practices to federal agencies. For more information about the Emerging IT Policies Division please contact Mr. Richard Kellett at (202) 501-1650, e-mail rich.kellett@gsa.gov or Mr. David Middledorf at (202) 501-1551, e-mail dave.middledorf@gsa.gov.
Federal Systems Integration and Management Center (FEDSIM) is a part of the General Services Administration’s Federal Technology Service and provides information technology client services on a fee-for-service basis. For more information on FEDSIM’s capabilities, please contact Ms. Martha Banks, Program Manager, at 703-756-4234 or by email at Martha.Banks@gsa.gov.
Acquisition Solutions, Inc (ASI) is a small business dedicated to assisting government agencies understand and implement acquisition reform and best practices. For information on this paper, or on ASI corporate capabilities, contact Mr. Chip Mather, Senior Vice President, at 703-378-3226, or by email at chipasi@erols.com
SIGNAL Corporation is a leading high technology services company, providing Information Technology, Engineering & Management, and Multimedia Services in industry and government. For more information on this paper, or on SIGNAL's capabilities, please contact Mr. Wayne Self, Vice President, at 703-205-2461 or by email at wayne_self@signalcorp.com or view their website at www.signalcorp.com.
TABLE OF CONTENTS
Forward i
Acknowledgement ii
Table of Contents iii
List of Acronyms iv
Chapter 1. Introduction 1-1
Chapter 2. Environment 2-1
Chapter 3. Contracting Vehicles/Techniques 3-1
Chapter 4. Examples of Identifying Appropriate Strategy 4-1
Chapter 5. Conclusion 5-1
Appendix. A FAR Guiding Principles A-1
Appendix. B GSA IT Professional Service B-1
Appendix. C FAR Definition of Commercial Items and Services C-1
LIST OF ACRONYMS
APR Agency Procurement Request
BPA Blanket Purchase Agreement
CICA Competition in Contracting Act
DISA Defense Information Systems Agency
DPA Delegation of Procurement Authority
FAR Federal Acquisition Regulation
FARA Federal Acquisition Reform Act of 1996 (Division D of P.L. 104-106, also known as the Clinger-Cohen Act)
FASA Federal Acquisition Streamlining Act of 1994 (P.L. 103-355)
FSS Federal Supply Service (as in GSA FSS contract)
GPRA Government Performance and Results Act
GSA General Services Administration
GSBCA General Services Board of Contract Appeals
GWAC Governmentwide Agency Contract
ID/IQ Indefinite Delivery/Indefinite Quantity
IAW In Accordance With
IT Information Technology
ITMRA Information Technology Management Reform Act (Division E of P.L. 104-106, also known as the Clinger-Cohen Act)
MAS Multiple Award Schedule
RFP Request for Proposals
RFQ Request for Quotations
SAP Simplified Acquisition Procedures
CHAPTER 1
INTRODUCTION
Acquisition reform has provided the program/project manager with a myriad of contractual vehicles and techniques to acquire goods and services. A problem unimagined just a few years ago, a program/project manager must now choose between dozens of techniques and literally thousands of existing contracts. Each of these options and techniques has associated advantages, disadvantages, overhead requirements, and risks.
Not only are there many more options/techniques available, program/project offices are not limited to a single approach. They can simultaneously use a variety of contract vehicles and techniques to satisfy their requirements. Program/project offices can use multiple approaches to meet both short (urgent) and long term requirements. For example, micro-purchases can be used to "fill in the gaps" rather than pursuing more complex, time-consuming techniques such as formal contract modifications. Federal Supply Service (FSS) blanket purchase agreements (BPA) can be put in place to cover short-term start up requirements such as installing cable, until a longer, more appropriate vehicle is awarded.
This unprecedented degree of choice has led to the question: Which vehicle/techniques is best for my program? This white paper was developed to assist the program/project manager answer that question. It presents the objectives, considerations, advantages, and disadvantages associated with the different contracting vehicles and techniques. This information will assist the program/project manager craft an acquisition strategy that balances their program’s cost, schedule, technical, and other considerations.
There is not a single acquisition strategy that is perfect for every situation. The "best" acquisition approach for a particular project or program can only be determined after examining each requirement’s many different objectives and environments. In some cases, such as imminent loss of life or significant loss of material, schedule becomes the paramount factor. In others, cost is the primary consideration. What may be "best" in one case could very well lead to a disaster in another. This is why the term "crafting an acquisition strategy" is appropriate. The program/project manager must address, in many cases, conflicting objectives and then chart a path that provides the greatest benefit, at a fair and reasonable price, with a manageable amount of risk.
Fortunately, the program/project manager does not have to make these decisions in a vacuum. Often there are individuals or a team of individuals from various support offices, including the contracting office, who have the training and experience to assist in making these decisions.
To assist in understanding the considerations involved in selecting the most appropriate contractual vehicle/technique for an acquisition, this paper provides the following information:
- Overview of the current acquisition environment.
- Discussion on the intent/purpose of the contractual options, their advantages and disadvantages, overhead and time-line considerations, as well as protest potential.
- Examples demonstrating the application and best usage of selected vehicles.
This paper is intended to support the needs of the program/project manager who is seeking a source to satisfy his or her requirement. It is not directed at the individual, or office, preparing to establish a suite of Governmentwide acquisition vehicles. The vast majority of program/project managers are seeking to solve their requirement and not provide another Governmentwide acquisition vehicle. On the other hand, for the program/project manager who has decided to pursue an open market contract, or award a Federal Supply Service (FSS) blanket purchase agreement (BPA), it is relatively easy to increase the scope and estimated quantities for the acquisition and allow government wide ordering.
This paper is written from a business perspective without an emphasis on rules and regulations. However, once an acquisition vehicle or technique is chosen, it is a good idea for the program/project manager to become more knowledgeable about the process. For a more detailed discussion of the rules and procedures, the reader is invited to obtain the soon to be released General Services Administration’s Guide to Planning, Acquiring, and Managing Information Technology Systems.
CHAPTER 2
ENVIRONMENT
Acquisition reform has changed, in a very fundamental way, the Federal government’s approach to acquiring goods and services. This section discusses this fundamental change.
In the pre-reform era, IT procurements were governed by the "Brooks Act." Agencies planning to conduct an acquisition with a value over a designated threshold had to prepare and forward an "agency procurement request" (APR) to GSA. If the APR was approved, GSA would issue a "delegation of procurement authority" (DPA) authorizing the agency to conduct the acquisition. The primary focus of the Brooks Act was to ensure that IT acquisitions were conducted in a manner that achieved full and open competition. This led to a focus on procurement and the pre-award source selection phase of the acquisition process as illustrated in Exhibit 2-1.
During this time, the award of a contract and defense of the inevitable protest were often the measures of success. Except in the case of highly public failures, very little attention was paid to the actual implementation of the system or whether the acquisition had achieved its goals in terms of cost, schedule, or quality. Another characteristic of the "Brooks" era was that individual offices had little incentive to work together. While some Trail Boss programs were the exception, for the most part each office did its own thing, forwarding the product or document to the next office for action. Additionally, acquisitions were often conducted with a sense of protest phobia, where every government action was examined in detail for its protest potential. The contracting officer and legal staff wielded considerable authority, as "process" was the principle focus of the acquisition. Too often, program offices had to accept less than desirable products, services, or timeliness as the cost of hyper scrupulous compliance with the letter, rather than the intent, of acquisition regulations.
Passage of a series of reform initiatives dramatically changed both the focus and process by which acquisitions are conducted. The combined effect of the Government Performance and Results Act (GPRA), Federal Acquisition Streamlining Act (FASA), Information Technology Management Reform Act (ITMRA), and Federal Acquisition Reform Act (FARA) changed the entire philosophy of the system. Where "full and open competition" was the watchword of the Brooks era and "process" was a dominant concern, "performance" and "results" describe today’s principle objectives. This change in philosophy shifted the emphasis from the mechanics of the contracting process to the need of agency.
This change brought on by acquisition reform also revised the relationship
of the acquisition team. To many, acquisition reform "solved" the procurement problem. Contracting officers were no longer the gatekeepers. The underlying objective of the procurement process changed from "full and open" to "efficient and effective" competition. FASA, in reforming acquisition, legitimized and provided a strong incentive for multiple award task and delivery order contracts. It further removed what were perceived as procedural impediments and streamlined the source selection process. Under acquisition reform, the primary objective of the acquisition team is to assist the program/project manager achieve cost, schedule, and performance goals.
FAR Guiding Principles
The new relationship is presented best in the FAR’s guiding principles. (See Exhibit 2-3) They are:
Excerpt from the Statement of Guiding Principles
for the Federal Acquisition System (FAR 1.102)
FAR ACQUSITION PRINCIPLES
Exhibit 2-3
As noted, acquisition reform has changed the focus and even the relationships among offices. No longer a "rules-based" process, agencies are encouraged to make decisions and exercise judgment on the best way to achieve program/project goals. This change is perhaps most visible in the relationship between the program/project manager and the contracting officer. The program/project manager is responsible for meeting cost, schedule and performance goals and objectives. The contracting officer is responsible for ensuring compliance with the requirements of law and regulation. The contracting officer further acts as the business manager providing information regarding industry standard business practices. As a team, they craft an approach that strikes a balance between the government and industry; the program’s cost, schedule, and performance objectives; and the requirements and intent of law and regulation.
Partnering for a Win-Win Contract
One of the important considerations in selecting a contractual vehicle/approach is its capability to encourage a "partnering" relationship between the government and the contractor. The proper application of performance-based contracting (discussing requirements in terms of desired results), well-chosen contract types and contract incentives, and well-planned evaluation and reporting on contractor performance all contribute to establishing a win-win relationship.
In today’s environment, it is important that the selected contracting vehicle/approach supports the program/project manager’s need to meet or exceed cost, schedule, and performance goals. Traditionally, agencies have crafted arrangements where the primary objective was for the contractor to meet the contract’s minimum standards of performance. In many cases, the contractor received little or no credit, or even recognition, if the standard was exceeded. However, the contractor was very likely to get a lot of attention for failure to perform. Many contractors quickly learned that expending effort and funds to exceed minimums was of little benefit. A dollar saved in minimally meeting the standard, or providing marginal performance, was a dollar profit.
A more customer-focused, "partnering" approach that encourages superior performance breaks this cycle. By using incentives tailored to the agency’s performance objectives, both the agency and contractor "win" when the objective is met and the incentive earned. It simply makes good business sense to provide the proper contract motivations to encourage high-quality contractor performance.
CHAPTER 3
CONTRACTING VEHICLES/TECHNIQUES
Crafting an acquisition strategy requires the program/project manager to balance cost, schedule, and performance concerns and arrive at the best strategy to satisfy the agency’s IT requirements. The selection of the "proper" vehicle/technique is critical. It affects the extent and intensity of competition, the amount and type of notice provided the private sector, the solutions and prices available and offered, the time to contract award, contractual terms and conditions, the type of contract and incentives, degree of control over contract management, the fees paid, the protest exposure, and many other areas.
The decision as to which contractual source to use involves trade-off. Can my agency order from an existing contract and acquire in a very short time (and at low overhead) most of the functionality originally conceived as the requirement? Or is the requirement so unique, the risk so high, and the degree of control my agency requires so significant, that a formal source selection is required to tailor the solution to my requirements.
Advantages and disadvantages of a particular contracting approach are directly related to the product and/or service being acquired. For example, when the agency anticipates a number of separate tasks over a period of time, the use of multiple awards, task order type contracts (such as GWACs or multiagency contracts) are particularly advantageous. Conversely, a "solutions" type requirement that is monolithic in nature and does not lend itself to being divided for individual competitions, may not benefit from multiple contractors and continued competition. As such, the advantages and disadvantages of the contract strategies must always be considered in light of the agency’s particular requirement.
Preferred Sources
The first step a program/project manager must take in selecting the appropriate contract vehicle/technique is to determine if a preferred source of supply can meet their needs. FAR 8.001 establish priorities for the acquisition of supplies and services from "Government supply sources." Exhibit 3-1 lists the preferred sources for supplies and services.
In practice, there are only two relevant preferred sources for information technology requirements. The most relevant is the optional use Federal Supply Schedule (FSS) contracts which cover a very broad range of equipment, supplies, and services. However, program/project managers should also be aware that there is a mandatory FSS contract for "core financial management" software and related services and support. The mandatory source is the Financial Management Systems Software (FMSS) Mandatory Multiple Award Schedule (MAS) Contracts Program.
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For supplies, the preferred sources in descending order are: |
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For services, the preferred sources in descending order are: |
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PREFERRED SOURCES FOR SUPPLIES AND SERVICES
Exhibit 3-1
With the exception of the FMSS MAS contract, there is no requirement to document the decision about whether a preferred source can or cannot meet the agencies need. If it is determined a FMSS MAS contract will not meet the need for financial management software, services, or support a waiver is required. (See FAR Subpart 8.9)
In addition to "preferred sources," satisfying requirements through existing contracts is preferable to open market purchases. FAR Part 13 (Simplified Acquisition Procedures) establishes a preference for using existing indefinite-delivery, indefinite-quantity (IDIQ) contracts or other established contracts if preferred sources are not available. Even if the requirement exceeds the simplified acquisition threshold (generally $100,000), ordering from a competitively awarded existing contract that meets the need would be (in nearly all cases) more cost effective than establishing a new contract. FASA included specific statutory language authorizing GWACs and multiagency contracts of two types: those for products (delivery order contracts) and those for services (task order contracts). The result of this authorization has been a significant increase in the number, availability, and coverage of these vehicles.
Federal Computer Week’s Government Technology Group recently published a 1998 GWAC Buyers’ Guide, identifying 25 GWACs, the contract awardees, and a brief description of the contracts. It is an excellent source of information regarding these vehicles. This information is available at http://www.fcw.com/pubs/gbb/guides.htm. Additional web sites containing information on GWAC contracts include:
Navy ITEC: http://itec-direct.navy.mil/
DOT: http://itop.dot.gov/itop/
NASA http://www.sewp.nasa.gov/sewpdoc/GenInfo.shtml
NIH: http://www.fedpage.com/gwac/
GSA: http://www.itpolicy.gsa.gov:80/mke/gwac/contrtoc.htm
GSA Federal Supply Schedule Contracts
Intent/Purpose
The GSA Federal Supply Schedule (FSS) program offers the program/project manager a suite of existing contracts with over 6,000 vendors providing over 4 million products. FSS contracts provide program/project managers simplified ordering vehicles to acquire commercial products and services. Following "commercial practices," GSA negotiated these contracts with volume-pricing discounts. GSA also recognized that IT pricing changes on an almost daily basis and instituted procedures allowing the ordering activity to request "spot market" and additional quantity discount pricing.
Advantages
- Nearly every commercial product and major service provider is available under GSA Schedule.
- Ordering authority can be delegated to the requesting activity. (A contracting officer need not issue the order.)
- Ordering customers conduct, and have considerable flexibility in, the selection process. After market research, the activity identifies schedule contractors to be included in the competition. They can also select the awardee on a "best value" basis as long as it results in the lowest overall cost.
- Approach is very streamlined. No public notices or small business coordination is required.
- Program is broadly known and information is readily available. (see http://pub.fss.gsa.gov/Sched/index.html)
- Teaming of schedule contractors is allowed to provide "total solutions."
- Streamlined Blanket Purchase Agreement (BPA) procedures provide for repetitive purchases.
- Process provides current technology at market prices. Spot market pricing and quantity discounts from GSA price list are available and encouraged.
Disadvantages
- Agency must often serve as the system integrator unless integration services are also ordered. Many products are drop-shipped.
- The number of contractors with which orders are placed can dilute product standardization. Unless a BPA is established, each order must go through the FSS competitive process.
- The GSA FSS program charges the contractors a 1% fee, which is passed onto the agency.
- The FSS contracts set standard contract terms and conditions. One size must fit all. Agencies cannot add special provisions and requirements outside the schedule. Agency loses some control, as they cannot modify the contract to meet special requirements.
- FSS contractor past performance information is generally not available. There is no formal past performance reporting system
- By statute (Competition In Contracting Act [CICA]), "best value" selection must also show that the award results in "lowest overall cost" – however, this is not necessarily the "lowest bid price."
- "Incidental items" that are required for a total solution but which are not contained on the vendor’s contract, cannot be easily added to a FSS order. If needed product or service is not on selected MAS contract (or on teaming partner’s), agency must follow standard FAR open market competitive procedures to add product to the delivery order. For incidental items under the micro-purchase threshold this is not a significant issue. Items exceeding $2,500 can be problematic.
Overhead: Time, Effort and Protest Risk
The FSS program’s streamlined ordering process can be accomplished in a matter of hours or days depending on the requirement. This is especially true for products and supplies. Service type requirements may require additional time to complete (5 to 10 days). This is due to the fact GSA has only determined the offered service’s hourly rate to be fair and reasonable. FSS contractors selected by the agency to compete must submit proposals identifying the labor categories (mix) and number of hours, which together determine the task’s price. The agency must then determine that the proposed task price is fair and reasonable.
GSA’s new, flexible, and streamlined ordering process has dramatically increased the use of FSS contracts. In general, when ordering products and supplies from these contracts, "ordering officers need not seek further competition, synopsize the requirement, make a separate determination of fair and reasonable pricing, or consider small business set-asides." For products, ordering from the FSS basically requires the agency to perform market research, identify at least three schedule contractors that can meet the requirement, and either select the contractor based on price list data, or request a price discount.
Additional effort by the ordering activity is required to acquiring professional IT services. GSA recently included in the newly released FSS Request for Proposal (RFP) a special provision for ordering professional IT services. (See Appendix B)
FSS orders are seldom challenged, largely because there are very limited grounds for protest. If the FAR procedures are followed, protest risk is very low. Protest risk increases when agencies attempt to modify/enhance the basic contract’s terms and conditions through the statement of work. Award of schedule orders to other than the lowest overall cost can also increase the risk of protest. By statute (CICA), awards under the schedule must be made to the contractor providing the "best value, at the lowest overall cost."
General Services Administration FSS Blanket Purchase Agreement (BPA)
Purpose/Intent
One innovative process GSA introduced to the schedule program was the procedural merging of an FSS contract with a simplified ordering procedure called a blanket purchase agreement (BPA). BPAs are used when an agency determines there is a continuing need for products or services.
A BPA for products is particularly useful where the agency wants to standardize on as set of products for interoperability and integration. Instead of conducting a competition for each purchase, the agency can conduct a one-time BPA competition. This allows the agency to aggregate requirements and obtain quantity discounts from the vendors. Once the BPA is awarded, further competition is not required. Agencies can place orders against the BPA for the selected goods.
As noted below, additional requirements are placed on BPA competitions for IT professional services.
FSS BPA Advantages (In Addition to FSS)
- Simplified ordering procedure is exceptionally useful for repetitive IT hardware/software purchases.
- Initial BPA competition usually provides quantity discounts over GSA FSS price.
- Allows simplified method of aggregating requirements through a competitive process.
- Agency can control the technical acceptability of the quotes by selecting the FSS contractors and products for which they want price quotes.
FSS BPA Disadvantages (In addition to FSS)
- BPA is not a contract and cannot be used to modify the basic FSS terms, conditions, or product selection.
- Additional effort is required to keep BPAs technologically refreshed and prices current. This may require frequent updates and changes.
Overhead: Time, Effort and Protest Risk
The initial FSS BPA competition can be completed in a matter of days or weeks depending on the size and complexity of the requirement. It is similar, in many respects, to the competition for individual FSS orders, but for aggregated requirements and longer periods of performance. There are, however, differing procedures for ordering products and services from established BPAs.
Products
To conduct the initial FSS BPA competition for products, the awarding organization performs market research and identifies the competing contractors. GSA suggests a minimum of three. Additional competitors can be invited based on the size and complexity of the requirement. The agency should also identify the schedule products for which they want competitive pricing. The agency notifies the selected contractors, identifies the products and size of the requirement, and requests price and performance quotes. Once quotes are received, the agency selects the contractor(s) to receive the BPA(s).
Ordering or placing "calls" against an established BPA for products and supplies can be accomplished in a matter of hours. In the case of a single BPA award, the requesting activity identifies the product and in accordance with (IAW) the BPA ordering instructions, notifies the contractor of the products to be delivered. For multiple awards, the requesting activity compares the products and price lists, makes its selection, and IAW the BPA ordering instructions, notifies the contractor of the products to be delivered. As with FSS contracts, ordering authority is often delegated to the requesting organization.
Services
GSA suggests agencies make multiple BPA awards for professional IT services. (See Appendix B) Again, GSA has only determined the FSS contract’s labor rates to be fair and reasonable. For IT professional services, both the initial FSS BPA and individual tasks should be competed. The BPA competition selects the winners. The task competition selects the BPA contractor and determines the labor mix and number of hours for the effort.
If an agency follows the simplified FSS competitive BPA procedures and makes price the principal award factor, there is limited protest risk. Ironically, protest risk is increased when agencies attempt to complicate the process, making it RFP-like. This includes publishing "evaluation criteria" and allowing the competitors to select the products they offer in response to their requirements. (See GAO protest decision B-278343) Protest risk also increases when agencies attempt to change the basic contract by accepting products, and/or including special provisions and terms and requirements, not included in the basic FSS contract.
Other Existing Contracts: Indefinite Delivery, Indefinite Quantity (ID/IQ);GWAC/ Multiagency/Agency Contracts
Intent/Purpose
Like GSA FSS schedule contracts, GWAC, multiagency and agency ID/IQ contracts are existing contract vehicles offering the program/project manager a large and varied selection of products, services and contractors. In most cases GWAC/multiagency/ agency contracts are awarded to multiple contractors. This pool of contractors then competes for individual task orders under a streamlined "fair opportunity" process. There currently exist dozens, if not hundreds of these vehicles. In fact, there is a "cottage industry" of agencies that actively market their awarded GWACs/multiagency ID/IQ contracts.
GSA schedule and ID/IQ GWACs are awarded under specific authorities that allow any Government activities to place orders. ID/IQ multiagency contracts are not awarded under a Governmentwide authority. ID/IQ multiagency contracts require agencies (other than the awarding agency) to process an Economy Act determination and findings (D&F) prior to ordering. (See FAR 17.5) ID/IQ agency contracts are awarded to cover only that agency’s requirements.
In contrast to GSA FSS contracts, the majority of GWACs/multiagency/agency ID/IQ contracts are written for a particular purpose and contain special terms and conditions for that activity. For example, Defense Information Systems Agency’s (DISA) Defense Enterprise Integration Service II contracts (DEIS II) contain both extensive terms and conditions and a variety of special provisions tailored for development-type efforts. The National Institute of Health’s Chief Information Officer Solutions and Partners (CIO-SP) contract, as the name implies, is focused on products and services to support the CIO offices.
It should be noted that FASA established a statutory preference (a "requirement" in the case of Advisory & Assistance Services) for multiple award GWAC/multiagency/agency ID/IQ contracts. In most cases, maintaining a competitive environment through multiple awards leads to decreased prices, increased quality, better performance, and increased flexibility for the agency. GWAC/multiagency/agency ID/IQ contracts also generally contain provisions for price reductions, technology refreshment, and collecting and applying past performance to fair opportunity competitions.
GWAC/Multiagency/Agency ID/IQ Contract Advantages
- Ordering customers have broad flexibility under the fair opportunity competitive process, including "best value" source selection decisions.
- Fair opportunity task order competitions are streamlined processes that limit a competition to the selected GWAC/multiagency/agency’s contractors. The fair opportunity process allows the requesting activity to review a variety of competitive solutions, approaches, and prices from the selected program’s highly qualified contractors.
- Past performance is a constant incentive to the contractor. Fair opportunity competition selection criteria usually requires review of the contract awardees’ previous task order performance.
- By statute (FASA), there are limited grounds for protest under a fair opportunity competition
- Many awarding offices provide order support up to and including using that contract’s agency contracting officers.
- Contracts are usually written for a specialized requirement (e.g., desktops, integration services, etc.) and therefore contain specialized terms and conditions for the contracted efforts.
- Large selection of products and potential service providers are available.
- On delivery order contracts where competitive environment is maintained, contractors have a strong incentive to provide current technology at market prices.
Disadvantages
- If not streamlined, technology refreshment (substitutions of newer products) and price discounts can take weeks to months to process, resulting in higher prices than offered under FSS spot market pricing provisions.
- Multiple contracts can dilute product standardization.
- Agencies ordering off GWACs or multiagency contracts usually have to pay a "fee" to the servicing agency. Fees can range from 1% to 6%.
Overhead: Time, Effort, and Protest Risk
Agencies acquire goods and services from multiple award GWAC/multiagency/agency IDIQ contracts through the fair opportunity competitive process. Under fair opportunity procedures, competition is limited to that vehicle’s contractors. For products (delivery orders), the agency reviews the existing contractors’ product and price lists, selects the best value, and notifies the contractor.
For services (task orders), the requesting agency develops a statement of work (preferably functional and performance based) and provides the selected vehicle contractors the opportunity to compete for that task. Using streamlined procedures, such as oral presentations and electronic posting of competitions on bulletin boards and Web sites, orders processed under fair opportunity procedures can be conducted in a matter of days or weeks. However, for more complex and expensive orders, agencies should allow a reasonable amount of time for contractors to prepare a proposal (2 to 4 weeks). Requesting unreasonably short proposal due dates negates many of the advantages of the ID/IQ multiple award contracts.
In attempting to make their vehicles more attractive, some organizations offering GWACs or multiagency contracts instituted fair opportunity procedures that permitted the ordering activities to name a "preferred vendor" for the task. The predicable result was the other vehicle’s contractors would not expend the effort to develop a fair opportunity proposal. This effectively circumvented competition and in most cases increases the cost of the task. It also eliminates the opportunity for the requesting activity to review a variety of solutions and approaches priced under competition. OMB has asked agencies to stop this process and requested that the FAR be changed to prohibit it.
By statute (FASA), there are limited grounds for protest under fair opportunity competitions. Further, protests are generally restricted to those who can show they are interested parties. In the case of fair opportunity task and delivery order competitions, protests are generally restricted to that vehicle’s contractors. Protest risk increases when the activity attempts to include tasks that are not within the scope of the basic contract. In these cases interested party status is more generally applied. Protests can also occur when the activity is performing a downselect, where two or more contractors were given an initial task and based on performance, only one will be awarded the remainder of the program’s requirements.
Open Market Options/Techniques
If the program/project manager determines that none of the preferred or existing sources can meet their needs, he or she can now look to the "open market" to satisfy the requirement. Open market procedures and techniques are driven primarily by the dollar amount of the action. Open market procedures and techniques include; micro-purchases, simplified acquisition procedures (SAP), full and open competitions, and commercial item acquisitions.
Micro-Purchases
Intent/Purpose
A micro-purchase is a simplified acquisition procedure for purchases under $2,500. The underlying philosophy behind this procedure is the realization that expending considerable effort for a competition under $2,500 would not generate sufficient savings to justify the expense. As such, micro-purchases need not be set aside for small business and, if the price is considered reasonable, may be awarded without soliciting competitive quotations. A micro-purchase is a procedure rather than a source, and can for instance, involve the placement of an order against an existing contract. Micro-purchases can be made by such means as: purchase orders; orders against FSS contracts; calls against BPAs; credit card purchases at local retailers or catalog companies; GSA Advantage; etc.
Advantages
- The most streamlined and simplest contracting technique, it literally only requires going to a local store, or ordering from a GSA Schedule or other catalog.
- Micro-purchasing authority is increasingly being delegated to the requesting activity. The majority of micro-purchases are now being made via credit card.
Disadvantages
- The procedure can be abused. There may be an increased risk of fraud, waste, and abuse.
- Activity may be tempted to split requirements to stay below micro-purchase threshold.
Overhead: Time, Effort, and Protest Risk
The simplest of all government purchasing procedures, micro-purchases only require an assessment that the price is reasonable. The majority of purchases are in local stores and against GSA schedule contracts or other catalogs, and can be made in a matter of minutes to hours. Most agencies have delegated micro-purchase authority to holders of government credit cards.
Protest risk is very low as the dollar amount of the order makes the cost of pursuing a protest prohibitive. Risk of protest does increase if it can be shown that the agency has split the requirement (i.e., taken a larger requirement and broken it into individual orders below $2,500). This action is prohibited.
Simplified Acquisition Procedures
Intent/Purpose
Simplified acquisition procedures (SAP) recognize that the time and expense of conducting a full and open competition is not warranted for acquisitions under the SAP threshold (generally $100,000). As such, SAP encourages the use of several techniques including; Credit card purchases; Purchase Orders; electronic purchasing; Blanket Purchase Agreements (BPAs); Impress funds, and Standard Form 44 (multi-purchase on the spot over the counter purchase forms). Simplified acquisition procedures use streamlined processes that permit innovative approaches, emphasize the use of FACNET and other electronic purchasing techniques, permit oral solicitation in certain circumstances, allow the use of a combined synopsis/solicitation. In addition, SAP orders are not formal government contracts and have eliminated many full and open clauses and provisions. (For additional information, see FAR Part 13 Simplified Acquisition Procedures)
Simplified acquisition procedures apply to acquisitions in which projected costs are below the simplified acquisition threshold (generally $100,000). Simplified acquisitions are set aside for small business (if over $2,500), publicized, and competed to the "maximum extent practicable."
Advantages
- The process encourages a streamlined competitive procedure.
- Increasingly used with electronic commerce to solicit quotes and make award.
- Simplified acquisitions support small businesses.
Disadvantages
- SAP competition is set aside exclusively for small business.
- Commerce Business Daily announcement requirements can result in large number of quotes with varying degrees of technical acceptability.
Overhead: Time, Effort, and Protest Risk
Simplified acquisition procedures permit a competition that can be completed in days (under $25,000) to weeks (over $25,000). The procedures follow the same concept as micro-purchases, in that the amount of effort placed on obtaining competition should commensurate with the expected savings and benefits. Requirements over $25,000 require announcement in the Commerce Business Daily and, unless justified by the urgency of the requirement, must be open for quotes for 15 days.
Risk of protest is generally low as the dollar amount of these procurements is not sufficient to expend funds to pursue a protest.
Simplified Acquisitions for Certain Commercial Items: Special Test Program
As a test program, the FAR authorizes the use of simplified acquisition procedures for the acquisition of supplies and services over $100,000, but not exceeding $5,000,000. This includes options, if the contracting officer reasonably expects, based on the nature of the supplies or services sought and on market research, that offers will include only commercial items.
This test program can be used for solicitations or requests for quotations issued before January 1, 2000. The purpose of the test program is to "vest contracting officers with additional procedural discretion and flexibility, so that commercial item acquisitions in this dollar range may be solicited, offered, evaluated, and awarded in a simplified manner that maximizes efficiency and economy and minimizes burden and administrative costs for both the Government and industry."
Full and Open Competitive Source Selection
Intent/Purpose
Full and open competitive source selection occurs when all responsible sources are permitted to compete. While there are a variety of techniques used for full and open competitive source selections (such as invitations for bids (IFB), two step IFB, etc.), the vast majority of such source selections of IT requirements are acquired under negotiated procedures. Contracting by negotiation is "intended to minimize the complexity of the solicitation, evaluation, and source selection decision, while maintaining a process designed to foster an impartial and comprehensive evaluation of offerors’ proposals, leading to selection of the proposal representing the best value to the Government." Although contracting by negotiation has traditionally been a time-consuming process, certain reform innovations have streamlined the process somewhat. These reform innovations include techniques such as the advisory multi-step process, oral presentations, and limiting competitive ranges for purposes of efficiency.
Advantages
- Contract can be tailored to address specific agency requirements, providing a solution-based, best-value selection.
- Source selection decision can be made using "best value" criteria.
- Potential exists for better initial pricing.
- Single contract allows standardization.
- Agency maintains total control of contract administration.
- Single contractor is better for establishing a teaming and partnering relationship as contractor is focused on agency’s unique requirements and procedures.
Disadvantages
- Single award provides no means of retaining effective competitive pressure for modifications or changes. This is most apparent in maintaining market prices and upgrading technology
- Single award pricing tends to be more static and less reflective of current market conditions.
- Approach is more broadly subject to protest, especially in regards to the selection decision.
- If single award, all the eggs are in one basket. If the contractor fails to perform, there are few acceptable options.
- Even streamlined, negotiated full and open competitions require extensive effort and long timeframes when contrasted to other options.
Overhead: Time, Effort, and Protest Risk
Full and open competition represents the most time and effort intensive of all the options addressed in this white paper. Even a "streamlined" source selection can take six to eight months (or more) to complete. The more complex the requirement, the more difficult the evaluation and source selection. Full and open competitive source selections using negotiated procedures require an experienced team, which can develop a comprehensive RFP. Additionally, formal, detailed, source selection, and acquisition plans are usually needed to help guide and manage the program. Senior level officials are often the named as the source selection authority, although some agencies appoint the contracting officer. Technical and price evaluations require a highly experienced and trained source selection team. In all, it is a labor intensive and complex procedure best used for large and complex requirements. However, even with these drawbacks, when compared to the other options, it is often the best approach when the requirement calls for a solution tailored to the agency’s requirements.
Risk of protest is the highest of all the options examined. Protests were once expected with the award of every major IT procurement. While dissolution of the IT protest-hearing authority of the General Services Board of Contract Appeals (GSBCA) significantly reduced the risk of protest, overall risk still remains quite high.
Commercial Item Acquisition
Intent/Purpose
Acquisition reform recognized that many government policies and requirements were in conflict with standard commercial practices. In many cases, companies were refusing to do business with the government due the significant overhead associated with government contracting practices and requirements. In an attempt to provide commercial activities relief, acquisition reform established commercial item procedures.
FAR Part 12 prescribes policies and procedures unique to the acquisition of commercial items. A threshold does not control use of commercial item acquisition procedures, but by the determination of whether or not the items to be acquired (which may be products or services) meet the FAR definition of "commercial."
Advantages
- Reduced complexity of solicitation/contract requirements. Eliminated or modified many non-essential provisions/clauses
- Encourages firms to offer commercial products to the government.
- Contracting officers encouraged to tailor contracts to incorporate standard commercial practices.
Disadvantages
- Some confusion has been introduced with adoption of new commercial standard contract format.
- Standard contract clauses that were well tested in the courts, were changed and are now subject to new interpretations and court challenges.
- Contract type limited to Firm Fixed Price, or Fixed Price with Economic Price Adjustments.
- While "commercial items" are very broadly defined, the definition of what constitutes "commercial" services is not clear and causes confusion. (See definition of commercial services [2.101 (e) and (f)] at Appendix C) Some activities identify IT professional services as "commercial" even though they do not meet the FAR definition.
Overhead: Time, Effort, and Protest Risk
Commercial acquisitions can use any of the open market techniques, noted in this paper. The time to complete a commercial acquisition is directly related to the acquisition method chosen. Commercial acquisition procedures do attempt to streamline the process by adopting policies and procedures more closely resembling those of the commercial marketplace versus more traditional acquisition procedures. In brief, commercial item acquisition permits use of practices such as reliance on available technical literature rather than written proposals, proposals by the offeror and separate evaluation of more than one product that will meet the need, reliance on contractors’ quality assurance systems rather than government inspection and acceptance, and tailoring of provisions and clauses to reflect customary commercial practices.
In addition, special solicitation provisions and contract clauses are established and special procedures set forth for use of streamlined, combined synopsis/solicitation. Contract types for commercial item acquisition under FAR Part 12 are limited to firm-fixed-price contracts or fixed-price with economic price adjustment required. Commercial item acquisition may be used in combination with simplified acquisition procedures, invitations for bids, or contracting by negotiation.
Risk of protest under commercial procedures is, in many regards, tied to the dollar level of the acquisition. It is, however, no greater than other procedures at similar dollar levels. Risk increases when the agency attempts to include services that do not meet the definition of "commercial." Protest risk is also slightly increased as many of the traditional solicitation provisions have been modified for commercial use. These clauses are for the most part new and untested.
- Government Credit Card
The Government credit card – more formally referred to as the Governmentwide commercial purchase card– can sometimes be used to procure and pay for purchases of commercially available equipment, supplies, or services. While not an acquisition technique in itself, the credit card can be used in conjunction with other acquisition methods. For example, credit cards can be used for micro-purchases.
The authority to have and use a Governmentwide commercial purchase card is not limited to contracting officers, but may be granted by agencies to individuals under "credit" limits and procedures determined by the agency.
The Governmentwide commercial purchase card may be used to:
- Make micro-purchases;
- Order from GSA Federal supply schedule contracts;
- Place a task or delivery order (if authorized in the basic contract, basic ordering agreement, or blanket purchase agreement); or
- Make payments, when the contractor agrees to accept payment by the card.
The use of the Government purchase card offers many benefits, such as ease and flexibility of use, streamlining of the procurement process, and reduction of administrative costs.
CHAPTER 4
EXAMPLES OF IDENTIFING APPROPRIATE STRATEGY
This chapter is included to provide examples of how the differing acquisition strategies can by used to satisfy real life requirements. The examples were chosen for their wide applicability and based on the varied approaches agencies are taking. They provide insight on how the acquisition strategy can meet what at times appear to be conflicting objectives.
- Example #1
The Problem/Requirement: Standard Products
Many agencies are experiencing significant interoperability and integration problems due to a proliferation of products acquired under decentralized ordering authority. Agencies would like to standardize on a few high quality and readily accepted products. What is the best contract vehicle/technique for the program/project manager who has been directed to standardize the agency’s desktop requirement?
Discussion
The significant costs and problems related to interoperability and integration, in conjunction with the requirement for agencies to develop a standard agency information architecture, has led to an increased focus on standardization. Agencies have attempted to solve this problem in a variety of ways.
Several agencies have included specific make and model products in their plan and mandated that subordinate offices purchase only those products. While this approach might meet schedule and performance objectives, it essentially ignores cost and competition. Announcement that the agency has standardized on a commercial product gives that contractor a sole source advantage. As for other strategies, some agencies have conducted full and open competitions and selected agency standard contractors using best value criteria.
A better approach may be to conduct a GSA schedule BPA competition. This approach accomplishes several important goals and provides some significant benefits.
- Advantages
- Example #2
- Conclusion
- REVISED GSA ORDERING PROCEDURES FOR IT PROFESSONAL SERVICES
First, a GSA schedule BPA competition establishes the agency standards through a competitive process. Agencies that aggregate the requirements can, through the competitive process, achieve significant discounts from GSA FSS prices. Further, the competition can be conducted in a matter of weeks.
Second, the agency can control which contractors participate in the BPA competition and which products are proposed. This is accomplished by conducting market research to compare GSA schedule commercial offerings to the agency’s needs. It is important that the competition includes a variety of contractors offering different manufacturer’s products and that the contractors are notified of such. Additionally, the number of competitors must be greater than the number of anticipated awards. There must be a loser or losers so that competitors truly compete in their pricing. BPA competitions do not require public announcement or notification. In theory, only those contractors and products that would have been highly rated in a full and open competitive source selection are invited to participate in a BPA competition. Following GSA procedures – and identifying both the contractors and products to be proposed – makes price the primary consideration. This approach places maximum price pressure on the competitors and offers the potential for significant savings in a streamlined, competitive selection.
Finally, while the BPA competitive process takes care of the initial award, the absence of competitive pressure will quickly erode the awarded BPA’s pricing and technological advantages. For that reason, the agency should consider dual or multiple awards. The advantages over the life of the agreement, in areas such as technology refreshment, product offerings, price, and BPA (contract) performance, far outweigh the loss in standardization.
Disadvantages
The downside of such an effort is the overhead required to manage the centralized BPAs. However, because of competitive pressure, many agencies have found that managing multiple award contracts is easier than administering single award contracts. In a competitive environment contractors offer technology refreshments and price adjustments to make their contract more attractive.
The Problem/Requirement: Systems Development Acquisition
An agency seeking to meet a custom requirement through a development contract has, until recently, often chosen to conduct a full and open competitive source selection. This was generally a labor-intensive effort, taking (at times) years to complete. Additionally, this approach required offerors to propose during the initial source selection a total solution. For example, to be acceptable, proposals had to include baseline estimates, for a system that was not yet designed, the code and testing tasks that would take place years in the future. These proposal estimates had a history of being very optimistic. A major problem with this approach is once the contract was awarded, the proposal estimates formed the program baseline. This significantly increased program risk.
Also, due to the difficulty of conducting separate source selections, hardware and system software requirements were often included in the software development source selection. This practice usually required significant effort to size and select hardware and system software for a system that again by definition, did not yet exist. In most cases, after spending hundreds or thousands of people-years of effort in proposing and evaluating the offered hardware and system software, it would not be the system that was delivered. This was due to the fact the hardware and system software would not, even in a best case scenario, be delivered for years in the future. Given the advancement of technology, and additional knowledge generated during the design and code phases about system requirements, it was predictable that none of the initial evaluated and benchmarked hardware and systems software would actually be delivered.
On top of all the above, most major IT development awards were protested. This placed additional time and overhead requirements on an already difficult process.
As an alternative, program/project managers can choose from a number of GWAC and multiagency task order contracts which were awarded with system development as their primary focus. As such, they were written to include development terms and conditions and contract provisions. Based on the initial competition, these contracts as a rule offer the top system development contractors in the business. Most likely, one of the GWAC contractors would have been an offeror, and winner, in any full and open competition. The availability of these contractors without the time and effort of a formal source selection makes these vehicles a very attractive option.
Advantages of the GWAC/Multiagency ID/IQ Task Order Approach
The fair-opportunity competitive process is significantly more streamlined than full and open competition. The "competition" is limited to those vehicle’s contractors. As these contractors were originally selected based on their corporate capabilities and experience, they generally represent the top talent in their respective areas. Fair opportunity competitions can be conducted in a matter of weeks or months depending on the size and complexity of the requirement. Additionally, the risk of protest is dramatically reduced. The fair opportunity process maintains competitive forces and makes the contractor "sharpen the pencil" and provide competitive solutions.
GWAC/multiagency contract vehicles that were awarded for development efforts also generally allow the award of differing contract types for each task order. For example, design and development efforts can be awarded and managed on a "cost plus" basis. Code and Test, or acquiring system software can be acquired under a fixed price type order. Additionally, these GWAC/multiagency contracts often contain incentive and award fee provisions that encourage a partnering arrangement by rewarding contractors for outstanding performance. Past performance reports are also a powerful incentive to the GWAC/multiagency contractor as award of future tasks is often based on past task performance. Finally, the fair opportunity procedures do allow the direct placement of an order when it is a natural follow-on to a previous task. This further encourages partnering as a contractor can be rewarded for exceptional performance with directed follow-on tasks.
GWAC/multiagency ID/IQ contracts provide the program/project manager vehicles and simplified competitive processes to pursue modular type contracting and break away from the grand design approach. Primarily, they facilitate a modular approach by offering multiple contractors that can compete for each module when it makes the most sense to begin development. For example, a modular approach allows the system’s hardware and software requirements to be competed when the system’s requirements are better defined. The contracts are also flexible enough to also permit award of a single task to a contractor to provide continuity for the system integration effort.
Disadvantages
The GWAC/multiagency ID/IQ task order approach offers significant advantages over a traditional development strategy. It can, however, increase program/project integration risk and management. Breaking a system into modules, and/or tracking multiple contractors can add overhead burden to the program/project office. Additionally, while most awarding offices delegate considerable administration authority to the program/ project office, the amount of direct control may be less than if the contract was awarded by the requesting agency.
CHAPTER 5
Program managers today are faced with a new and, until recently, a largely unimaginable problem – too many contracting choices. Acquisition reform provided the program/ project manager with an unprecedented degree of choice. The many options have complicated what was once a relatively limited decision; What is the best approach for my requirement?
It is important to understand that the requirement dictates the appropriate acquisition method – not vice versa. With an understanding of the various alternatives described in this white paper, the program/project manager can craft an acquisition strategy appropriate to his or her requirement’s cost, schedule, and performance objectives.
Selection of the appropriate contract vehicle/technique is a critical decision for any program/project manager. The selection affects; the extent and intensity of competition, amount and type of notice provided the private sector, the solutions and prices available and offered, the time to contract award, contractual terms and conditions, type of contract and incentives, degree of control over contract management, fees paid, protest exposure, and many other areas.
Not only are there many more options/techniques available, program/project offices are not limited to a single approach. They can simultaneously use a variety of contract vehicles and techniques to satisfy their requirements. Program/project offices can use multiple approaches to meet both short (urgent) and long term requirements. For example, micro-purchases purchases can be used to "fill in the gaps" rather than pursuing more complex and time consuming options/techniques such as formal contract modifications. GSA FSS BPAs can be put in place to cover short-term requirements such as installing cable, until a longer, more appropriate vehicle is awarded.
Acquisition reform has changed the very focus and principal objective of the procurement system. This change in focus is clearly demonstrated in the new FAR guiding principles. Contracting offices are transitioning from keepers of a "process" to agency business advisors. It is no longer a case of following a regulation, but rather, applying the underlying concepts and objectives to the specifics of the requirement and environment. Contracting officers can best meet this challenge by transitioning from "gatekeepers" to business advisors. This requires knowledge and insight into acquisition alternatives and industry practices.
This white paper does not focus on the regulations and procedural requirements, but on the business perspective of the approaches. It presents the most common contract techniques and vehicles to give the program/project manager a sense of each option’s advantages and disadvantages, timelines, overhead requirements, and protest risk. This white paper is, however, only an overview and does not provide specific guidance and direction for the acquisition alternatives. Program/project managers are encouraged to work with their contracting officers to craft the most appropriate acquisition alternative.
APPENDIX A
Statement of guiding principles
for the Federal Acquisition System (FAR 1.102)
The following is provided verbatim from FAR 1.102. It presents an overview of the vision for the Federal Acquisition System that captures many of the concepts underlying acquisition reform. Most notably, it changes the focus of the acquisition system from process and procedures to application of good business judgement.
FAR 1.102
(a) The vision for the Federal Acquisition System is to deliver on a timely basis the best value product or service to the customer, while maintaining the public's trust and fulfilling public policy objectives. Participants in the acquisition process should work together as a team and should be empowered to make decisions within their area of responsibility.
(b) The Federal Acquisition System will--
(1) Satisfy the customer in terms of cost, quality, and timeliness of the delivered product or service by, for example--
(i) Maximizing the use of commercial products and services;
(ii) Using contractors who have a track record of successful past performance or who demonstrate a current superior ability to perform; and
(iii) Promoting competition;
(2) Minimize administrative operating costs;
(3) Conduct business with integrity, fairness, and openness; and
(4) Fulfill public policy objectives.
(c) The Acquisition Team consists of all participants in Government acquisition including not only representatives of the technical, supply, and procurement communities but also the customers they serve, and the contractors who provide the products and services.
(d) The role of each member of the Acquisition Team is to exercise personal initiative and sound business judgment in providing the best value product or service to meet the customer's needs. In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority.
1.102-1 Discussion.
(a) Introduction. The statement of Guiding Principles for the Federal Acquisition System (System) represents a concise statement designed to be user-friendly for all participants in Government acquisition. The following discussion of the principles is provided in order to illuminate the meaning of the terms and phrases used. The framework for the System includes the Guiding Principles for the System and the supporting policies and procedures in the FAR.
(b) Vision. All participants in the System are responsible for making acquisition decisions that deliver the best value product or service to the customer. Best value must be viewed from a broad perspective and is achieved by balancing the many competing interests in the System. The result is a system, which works better and costs less.
1.102-2 Performance Standards.
(a) Satisfy the customer in terms of cost, quality, and timeliness of the delivered product or service.
(1) The principal customers for the product or service provided by the System are the users and line managers, acting on behalf of the American taxpayer.
(2) The System must be responsive and adaptive to customer needs, concerns, and feedback. Implementation of acquisition policies and procedures, as well as consideration of timeliness, quality, and cost throughout the process, must take into account the perspective of the user of the product or service.
(3) When selecting contractors to provide products or perform services, the Government will use contractors who have a track record of successful past performance or who demonstrate a current superior ability to perform.
(4) The Government must not hesitate to communicate with the commercial sector as early as possible in the acquisition cycle to help the Government determine the capabilities available in the commercial marketplace. The Government will maximize its use of commercial products and services in meeting Government requirements.
(5) It is the policy of the System to promote competition in the acquisition process.
(6) The System must perform in a timely, high quality, and cost-effective manner.
(7) All members of the Team are required to employ planning as an integral part of the overall process of acquiring products or services. Although advance planning is required, each member of the Team must be flexible in order to accommodate changing or unforeseen mission needs. Planning is a tool for the accomplishment of tasks, and application of its discipline should be commensurate with the size and nature of a given task.
(b) Minimize administrative operating costs.
(1) In order to ensure that maximum efficiency is obtained, rules, regulations, and policies should be promulgated only when their benefits clearly exceed the costs of their development, implementation, administration, and enforcement. This applies to internal administrative processes, including reviews, and to rules and procedures applied to the contractor community.
(2) The System must provide uniformity where it contributes to efficiency or where fairness or predictability is essential. The System should also, however, encourage innovation, and local adaptation where uniformity is not essential.
(c) Conduct business with integrity, fairness, and openness.
(1) An essential consideration in every aspect of the System is maintaining the public's trust. Not only must the system have integrity, but also the actions of each member of the team must reflect integrity, fairness, and openness. The foundation of integrity within the System is a competent, experienced, and well-trained, professional workforce. Accordingly, each member of the Team is responsible and accountable for the wise use of public resources, as well as, acting in a manner that maintains the public's trust. Fairness and openness require open communication among team members, internal and external customers, and the public.
(2) To achieve efficient operations, the System must shift its focus from "risk avoidance" to one of "risk management." The cost to the taxpayer of attempting to eliminate all risk is prohibitive. The Executive Branch will accept and manage the risk associated with empowering local procurement officials to take independent action based on their professional judgment.
(3) The Government shall exercise discretion, use sound business judgment, and comply with applicable laws and regulations in dealing with contractors and prospective contractors. All contractors and prospective contractors shall be treated fairly and impartially but need not be treated the same.
(d) Fulfill public policy objectives. The System must support the attainment of public policy goals adopted by the Congress and the President. In attaining these goals, and in its overall operations, the process shall ensure the efficient use of public resources.
1.102-3 Acquisition Team.
The purpose of defining the Federal Acquisition Team (Team) in the Guiding Principles is to ensure that participants in the System are identified beginning with the customer and ending with the contractor of the product or service. By identifying the team members in this manner, teamwork, unity of purpose, and open communication among the members of the Team in sharing the vision and achieving the goal of the System are encouraged. Individual team members will participate in the acquisition process at the appropriate time.
1.102-4 Role of the Acquisition Team.
(a) Government members of the Team must be empowered to make acquisition decisions within their areas of responsibility, including selection, negotiation, and administration of contracts consistent with the Guiding Principles. In particular, the contracting officer must have the authority to the maximum extent practicable and consistent with law, to determine the application of rules, regulations, and policies, on a specific contract.
(b) The authority to make decisions and the accountability for the decisions made will be delegated to the lowest level within the System, consistent with law.
(c) The Team must be prepared to perform the functions and duties assigned. The Government is committed to provide training, professional development, and other resources necessary for maintaining and improving the knowledge, skills, and abilities for all Government participants on the Team, both with regard to their particular area of responsibility within the System, and their respective role as a team member. The contractor community is encouraged to do likewise.
(d) The System will foster cooperative relationships between the Government and its contractors consistent with its overriding responsibility to the taxpayers.
(e) The FAR outlines procurement policies and procedures that are used by members of the Acquisition Team. If a policy or procedure, or a particular strategy or practice, is in the best interest of the Government and is not specifically addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, Government members of the Team should not assume it is prohibited. Rather, absence of direction should be interpreted as permitting the Team to innovate and use sound business judgment that is otherwise consistent with law and within the limits of their authority. Contracting officers should take the lead in encouraging business process innovations and ensuring that business decisions are sound.
APPENDIX B
The following GSA terms and conditions were included in GSA’s recently release Federal Supply Service Information Technology solicitation (Solicitation Number: FCIS-JB-980001B). It can be viewed at http://pub.fss.gsa.gov/Sched/index.html. The revised terms and conditions establish ordering procedures for FSS IT professional services. This including the establishment and ordering services based on hourly rates from blanket purchase agreements. The new terms and conditions also include provisions traditionally associated with service contracts such as Organizational Conflict of Interest (OCI)
GSA is currently in the process of modifying existing schedule 70 IT FSS contracts that offer IT professional services, to incorporate the below terms and conditions.
REVISED TERMS AND CONDITIONS FOR INFORMATION TECHNOLOGY (IT) PROFESSIONAL SERVICES (SIN 132-51) AND ELECTRONIC COMMERCE (EC) SERVICES (SIN 132-52). Revised ordering procedures have been established for IT/EC services, including BPAs, for services based on hourly rates. Organizational Conflict of Interest Provisions have also been included under the services terms and conditions.
TERMS AND CONDITIONS APPLICABLE TO INFORMATION TECHNOLOGY (IT)
PROFESSIONAL SERVICES (SPECIAL ITEM NUMBER 132-51) AND
ELECTRONIC COMMERCE (EC) SERVICES (SPECIAL ITEM NUMBER 132-52)
**The phrase, "Information Technology (IT) Professional Services/Electronic Commerce (EC) Services" in the following paragraphs may need to be revised in order to be consistent with the Offeror’s proposal; e.g., if only IT Professional Services are offered, all references to EC Services should be deleted.**
1. SCOPE
a. The prices, terms and conditions stated under Special Item Number 132-51 Information Technology Professional Services and Special Item Number 132-52 Electronic Commerce Services apply exclusively to IT/EC Services within the scope of this Information Technology Schedule.
b. The Contractor shall provide services at the Contractor’s facility and/or at the Government location, as agreed to by the Contractor and the ordering office.
**NOTE: Include paragraph 2, only if hourly rates for IT Professional Services are offered.**
2. ORDERING PROCEDURES
a. Procedures for IT professional services priced on GSA schedule at hourly rates.
(1) FAR 8.402 contemplates that GSA may occasionally find it necessary to establish special ordering procedures for individual Federal Supply Schedules or for some Special Item Numbers (SINs) within a Schedule. GSA has established special ordering procedures for IT professional services (SIN 132-51) that are priced on schedule at hourly rates. These special ordering procedures which are outlined herein take precedence over the procedures in FAR 8.404.
(2) The GSA has determined that the rates for IT professional services contained in this pricelist are fair and reasonable. However, the ordering office using this contract is responsible for considering the level of effort and mix of labor proposed to perform a specific task being ordered and for making a determination that the total firm-fixed price or ceiling price is fair and reasonable.
(3) When ordering IT professional services ordering offices shall –
(i) Prepare a Request for Quotation:
(A) A performance-based statement of work that outlines, at a minimum, the work to be performed, location of work, period of performance, deliverable schedule, applicable standards, acceptance criteria, and any special requirements (i.e., security clearances, travel, special knowledge, etc.) should be prepared.
(B) A request for quotation should be prepared which includes the performance-based statement of work and requests the contractors submit either a firm-fixed price or a ceiling price to provide the services outlined in the statement of work. A firm-fixed price order shall be requested, unless the ordering office makes a determination that it is not possible at the time of placing the order to estimate accurately the extent or duration of the work or to anticipate cost with any reasonable degree of confidence. When such a determination is made, a labor hour or time-and-materials proposal may be requested. The firm-fixed price shall be based on the hourly rates in the schedule contract and shall consider the mix of labor categories and level of effort required to perform the services described in the statement of work. The firm-fixed price of the order should also include any travel costs or other incidental costs related to performance of the services ordered, unless the order provides for reimbursement of travel costs at the rates provided in the Federal Travel or Joint Travel Regulations. A ceiling price must be established for labor hour and time and material orders.
(C) The request for quotation may request the contractors, if necessary or appropriate, submit a project plan for performing the task and information on the contractor’s experience and/or past performance performing similar tasks.
(D) The request for quotation shall notify the contractors what basis will be used for selecting the contractor to receive the order. The notice shall include the basis for determining whether the contractors are technically qualified and provide an explanation regarding the intended use of any experience and/or past performance information in determining technical acceptability of responses. If consideration will be limited to schedule contractors who are small business concerns as permitted by paragraph (ii)(A) below, the request for quotations shall notify the contractors that will be the case.
(ii) Transmit the Request for quotation to Contractors:
(A) Based upon an initial evaluation of catalogs and pricelists, the ordering office should identify the contractors that appear to offer the best value (considering the scope of services offered, hourly rates and other factors such as contractors’ locations, as appropriate). When buying IT professional services under SIN 132-51 ONLY, the ordering office, at its discretion, may limit consideration to those schedule contractors that are small business concerns. This limitation is not applicable when buying supplies and/or services under other SINs as well as SIN 132-51. The limitation may only be used when at least three (3) small businesses that appear to offer services that will meet the agency’s needs are available, if the order is estimated to exceed the micro-purchase threshold.
(B) The request for quotation should be to three (3) contractors if the proposed order is estimated to exceed the micro-purchase threshold, but not to exceed the maximum order threshold. For proposed orders exceeding the maximum order threshold, the request for quotation should be provided to additional contractors that offer services that will meet the agency’s needs. Ordering offices should strive to minimize the contractors’ costs associated with responding to requests for proposals for specific orders. Requests should be tailored to the minimum level necessary for adequate evaluation and selection for order placement.
(iii) Evaluate proposals and select the contractor to receive the order:
After responses have been evaluated against the factors identified in the request for quotation, the order should be placed with the schedule contractor that represents the best value and results in the lowest overall cost alternative (considering price, special qualifications, administrative costs, etc.) to meet the Government’s needs.
(4) The establishment of Federal Supply Schedule Blanket Purchase Agreements (BPAs) for recurring services is permitted when the procedures outlined herein are followed. All BPAs for services must define the services that may be ordered under the BPA, along with delivery or performance time frames, billing procedures, etc. The potential volume of orders under BPAs, regardless of the size of individual orders, may offer the ordering office the opportunity to secure volume discounts. When establishing BPAs ordering offices shall –
(i) Inform contractors in the request for quotation (based on the agency’s requirement) if a single BPA or multiple BPAs will be established, and indicate the basis that will be used for selecting the contractors to be awarded the BPAs.
(A) SINGLE BPA: Generally, a single BPA should be established when the ordering office can define the tasks to be ordered under the BPA and establish a firm-fixed price or ceiling price for individual tasks or services to be ordered. When this occurs, authorized users may place the order directly under the established BPA when the need for service arises. The schedule contractor that represents the best value and results in the lowest overall cost alternative to meet the agency's needs should be awarded the BPA.
(B) MULTIPLE BPAs: When the ordering office determines multiple BPAs are needed to meet its requirements, the ordering office should determine which contractors can meet any technical qualifications before establishing the BPAs. When multiple BPAs are established, the authorized users must follow the procedure in (3)(ii)(B) above, and then place the order with the schedule contractor that represents the best value and results in the lowest overall cost alternative to meet the agency’s needs.
(ii) Review BPAs periodically. Such reviews shall be conducted at least annually. The purpose of the review is to determine whether the BPA still represents the best value (considering price, special qualifications, etc.) and results in the lowest overall cost alternative to meet the agency’s needs.
(5) The ordering office should give preference to small business concerns when two or more contractors can provide the services at the same firm-fixed price or ceiling price.
(6) When the ordering office’s requirement involves both products as well as IT professional services, the ordering office should total the prices for the products and the firm-fixed price for the services and select the contractor that represents the greatest value in terms of meeting the agency’s total needs.
(7) The ordering office, at a minimum, should document orders by identifying the contractor the services were purchased from, the services purchased, and the amount paid. If other than a firm-fixed price order is placed, such documentation should include the basis for the determination to use a labor-hour or time-and-materials order. For agency requirements in excess of the micro-purchase threshold, the order file should document the evaluation of schedule contractors’ proposals that formed the basis for the selection of the contractor that received the order and the rationale for any trade-offs made in making the selection.
b. Ordering Procedures for other services available on schedule at fixed prices for specifically defined services or tasks.
Orders placed pursuant to a Multiple Award Schedule (MAS), using the procedures in FAR 8.404, are considered to be issued pursuant to full and open competition. Therefore, when placing orders under Federal Supply Schedules, ordering offices need not seek further competition, synopsize the requirement, make a separate determination of fair and reasonable pricing, or consider small business set-asides in accordance with subpart 19.5. GSA has already determined the prices of items under schedule contracts to be fair and reasonable. By placing an order against a schedule using the procedures outlined below, the ordering office has concluded that the order represents the best value and results in the lowest overall cost alternative (considering price, special features, administrative costs, etc.) to meet the Government’s needs.
(1) Orders placed at or below the micro-purchase threshold. Ordering offices can place orders at or below the micro-purchase threshold with any Federal Supply Schedule Contractor.
(2) Orders exceeding the micro-purchase threshold but not exceeding the maximum order threshold. Orders should be placed with the Schedule Contractor that can provide the supply or service that represents the best value. Before placing an order, ordering offices should consider reasonably available information about the service offered under MAS contracts by using the "GSA Advantage!" on-line shopping service, or by reviewing the catalogs/pricelists of at least three Schedule Contractors and selecting the delivery and other options available under the schedule that meets the agency’s needs. In selecting the service representing the best value, the ordering office may consider— (i) special features of the service that are required in effective program performance and that are not provided by a comparable service; and (ii) past performance.
(3) Orders exceeding the maximum order threshold. Each schedule contract has an established maximum order threshold. This threshold represents the point where it is advantageous for the ordering office to seek a price reduction. In addition to following the procedures in paragraph b, above, and before placing an order that exceeds the maximum order threshold, ordering offices shall--
(i) Review additional Schedule Contractors’ catalogs/pricelists or use the "GSA Advantage!" on-line shopping service;
(ii) Based upon the initial evaluation, generally seek price reductions from the Schedule Contractor(s) appearing to provide the best value (considering price and other factors); and
(iii) After price reductions have been sought, place the order with the Schedule Contractor that provides the best value and results in the lowest overall cost alternative. If further price reductions are not offered, an order may still be placed, if the ordering office determines that it is appropriate.
NOTE: For orders exceeding the maximum order threshold, the Contractor may:
(A) Offer a new lower price for this requirement (the Price Reductions clause is not applicable to orders placed over the maximum order in FAR 52.216-19 Order Limitations);
(B) Offer the lowest price available under the contract; or
(C) Decline the order (orders must be returned in accordance with FAR 52.216-19).
(4) Blanket purchase agreements (BPAs). The establishment of Federal Supply Schedule BPAs is permitted when following the ordering procedures in FAR 8.404. All schedule contracts contain BPA provisions. Ordering offices may use BPAs to establish accounts with Contractors to fill recurring requirements. BPAs should address the frequency of ordering and invoicing, discounts, and delivery locations and times.
(5) Price reductions. In addition to the circumstances outlined in paragraph (3), above, there may be instances when ordering offices will find it advantageous to request a price reduction. For example, when the ordering office finds a schedule service elsewhere at a lower price or when a BPA is being established to fill recurring requirements, requesting a price reduction could be advantageous. The potential volume of orders under these agreements, regardless of the size of the individual order, may offer the ordering office the opportunity to secure greater discounts. Schedule Contractors are not required to pass on to all schedule users a price reduction extended only to an individual agency for a specific order.
(6) Small business. For orders exceeding the micro-purchase threshold, ordering offices should give preference to the items of small business concerns when two or more items at the same delivered price will satisfy the requirement.
(7) Documentation. Orders should be documented, at a minimum, by identifying the Contractor the item was purchased from, the item purchased, and the amount paid. If an agency requirement in excess of the micro-purchase threshold is defined so as to require a particular brand name, product, or feature of a product peculiar to one manufacturer, thereby precluding consideration of a product manufactured by another company, the ordering office shall include an explanation in the file as to why the particular brand name, product, or feature is essential to satisfy the agency’s needs.
3. ORDER
a. Agencies may use written orders, EDI orders, blanket purchase agreements, individual purchase orders, or task orders for ordering services under this contract. Blanket Purchase Agreements shall not extend beyond the end of the contract period; all services and delivery shall be made and the contract terms and conditions shall continue in effect until the completion of the order. Orders for tasks that extend beyond the fiscal year for which funds are available shall include FAR 52.232-19 Availability of Funds for the Next Fiscal Year. The purchase order shall specify the availability of funds and the period for which funds are available.
b. All task orders are subject to the terms and conditions of the contract. In the event of conflict between a task order and the contract, the contract will take precedence.
4. PERFORMANCE OF SERVICES
a. The Contractor shall commence performance of services on the date agreed to by the Contractor and the ordering office.
b. The Contractor agrees to render services only during normal working hours, unless otherwise agreed to by the Contractor and the ordering office.
c. The Contractor guarantees the satisfactory completion of the IT/EC Services performed under the task order and that all contract personnel utilized in the performance of IT/EC services under the task order shall have the education, experience, and expertise as stated in the task order.
d. Any Contractor travel required in the performance of IT/EC Services must comply with the Federal Travel Regulation or Joint Travel Regulations, as applicable, in effect on the date(s) the travel is performed. Established Federal Government per diem rates will apply to all Contractor travel. Contractors cannot use GSA city pair contracts.
5. INSPECTION OF SERVICES
The Inspection of Services–Fixed Price (AUG 1996) clause at FAR 52.246-4 applies to firm-fixed price orders placed under this contract. The Inspection–Time-and-Materials and Labor-Hour (JAN 1986) clause at FAR 52.246-6 applies to time-and-materials and labor-hour orders placed under this contract.
6. RESPONSIBILITIES OF THE CONTRACTOR
The Contractor shall comply with all laws, ordinances, and regulations (Federal, State, City, or otherwise) covering work of this character.
7. RESPONSIBILITIES OF THE GOVERNMENT
Subject to security regulations, the ordering office shall permit Contractor access to all facilities necessary to perform the requisite IT/EC Services.
8. INDEPENDENT CONTRACTOR
All IT/EC Services performed by the Contractor under the terms of this contract shall be as an independent Contractor, and not as an agent or employee of the Government.
9. ORGANIZATIONAL CONFLICTS OF INTEREST
a. Definitions.
"Contractor" means the person, firm, unincorporated association, joint venture, partnership, or corporation that is a party to this contract.
"Contractor and its affiliates" and "Contractor or its affiliates" refers to the Contractor, its chief executives, directors, officers, subsidiaries, affiliates, subcontractors at any tier, and consultants and any joint venture involving the Contractor, any entity into or with which the Contractor subsequently merges or affiliates, or any other successor or assignee of the Contractor.
An "Organizational conflict of interest" exists when the nature of the work to be performed under a proposed Government contract, without some restriction on activities by the Contractor and its affiliates, may either (i) result in an unfair competitive advantage to the Contractor or its affiliates or (ii) impair the Contractor’s or its affiliates’ objectivity in performing contract work.
b. To avoid an organizational or financial conflict of interest and to avoid prejudicing the best interests of the Government, ordering offices may place restrictions on the Contractors, its affiliates, chief executives, directors, subsidiaries and subcontractors at any tier when placing orders against schedule contracts. Such restrictions shall be consistent with FAR 9.505 and shall be designed to avoid, neutralize, or mitigate organizational conflicts of interest that might otherwise exist in situations related to individual orders placed against the schedule contract. Examples of situations, which may require restrictions, are provided at FAR 9.508.
10. INVOICES
The Contractor, upon completion of the work ordered, shall submit invoices for IT/EC services. Progress payments may be authorized by the ordering office on individual orders if appropriate. Progress payments shall be based upon completion of defined milestones or interim products. Invoices shall be submitted monthly for recurring services performed during the preceding month.
11. PAYMENTS
For firm-fixed price orders the Government shall pay the Contractor, upon submission of proper invoices or vouchers, the prices stipulated in this contract for service rendered and accepted. Progress payments shall be made only when authorized by the order. For time-and-materials orders, the Payments under Time-and-Materials and Labor-Hour Contracts (Alternate I (APR 1984)) at FAR 52.232-7 applies to time-and-materials orders placed under this contract. For labor-hour orders, the Payment under Time-and-Materials and Labor-Hour Contracts (FEB 1997) (Alternate II (JAN 1986)) at FAR 52.232-7 applies to labor-hour orders placed under this contract.
12. RESUMES
Resumes shall be provided to the GSA Contracting Officer or the user agency upon request.
13. INCIDENTAL SUPPORT COSTS
Incidental support costs are available outside the scope of this contract. The costs will be negotiated separately with the ordering agency in accordance with the guidelines set forth in the FAR.
14. APPROVAL OF SUBCONTRACTS
The ordering activity may require that the Contractor receive, from the ordering activity's Contracting Officer, written consent before placing any subcontract for furnishing any of the work called for in a task order.
15. DESCRIPTION OF IT/EC SERVICES AND PRICING
**NOTE TO CONTRACTORS: The information provided below is designed to assist Contractors in providing complete descriptions and pricing information for the IT/EC Services offered. This language should NOT be printed as part of the Information Technology Schedule Pricelist; instead, Contractors should provide the same type of information as it relates to the IT/EC Services offered under the contract.**
a. The Contractor shall provide a description of each type of IT/EC Service offered under Special Item Numbers 132-51 and 132-52. IT/EC Services should be presented in the same manner as the Contractor sells to its commercial and other Government customers. If the Contractor is proposing hourly rates, a description of all corresponding commercial job titles (labor categories) for those individuals who will perform the service should be provided.
b. Pricing for all IT/EC Services shall be in accordance with the Contractor’s customary commercial practices; e.g., hourly rates, monthly rates, term rates, and/or fixed prices.
The following is an example of the manner in which the description of a commercial job title should be presented:
EXAMPLE:
Commercial Job Title: System Engineer
Minimum/General Experience: Three (3) years of technical experience which applies to systems analysis and design techniques for complex computer systems. Requires competence in all phases of systems analysis techniques, concepts and methods; also requires knowledge of available hardware, system software, input/output devices, structure and management practices.
Functional Responsibility: Guides users in formulating requirements, advises alternative approaches, conducts feasibility studies.
Minimum Education: Bachelor’s Degree in Computer Science
APPENDIX C
FAR 2.101 DEFINITION OF COMMERCIAL ITEM AND SERVICE
The following FAR definition of commercial item and service shows the wide difference between the very broad definition of commercial item (paragraphs (a) through (d)) and the relatively narrow definition of commercial services (paragraphs (e) and (f)).
FAR 2.101
"Commercial component" means any component that is a commercial item.
"Commercial item" means--
(a) Any item, other than real property, that is of a type customarily used for nongovernmental purposes and that--
(1) Has been sold, leased, or licensed to the general public; or
(2) Has been offered for sale, lease, or license to the general public;
(b) Any item that evolved from an item described in paragraph (a) of this definition through advances in technology or performance and that is not yet available in the commercial marketplace, but will be available in the commercial marketplace in time to satisfy the delivery requirements under a Government solicitation;
(c) Any item that would satisfy a criterion expressed in paragraphs (a) or (b) of this definition, but for--
(1) Modifications of a type customarily available in the commercial marketplace; or
(2) Minor modifications of a type not customarily available in the commercial marketplace made to meet Federal Government requirements. Minor modifications means modifications that do not significantly alter the nongovernmental function or essential physical characteristics of an item or component, or change the purpose of a process. Factors to be considered in determining whether a modification is minor include the value and size of the modification and the comparative value and size of the final product. Dollar values and percentages may be used as guideposts, but are not conclusive evidence that a modification is minor;
(d) Any combination of items meeting the requirements of paragraphs (a), (b), (c), or (e) of this definition that are of a type customarily combined and sold in combination to the general public;
(e) Installation services, maintenance services, repair services, training services, and other services if such services are procured for support of an item referred to in paragraphs (a), (b), (c), or (d) of this definition, and if the source of such services-
(1) Offers such services to the general public and the Federal Government contemporaneously and under similar terms and conditions; and
(2) Offers to use the same work force for providing the Federal Government with such services as the source uses for providing such services to the general public;
(f) Services of a type offered and sold competitively in substantial quantities in the commercial marketplace based on established catalog or market prices for specific tasks performed under standard commercial terms and conditions. This does not include services that are sold based on hourly rates without an established catalog or market price for a specific service performed;
(g) Any item, combination of items, or service referred to in paragraphs (a) through (f), notwithstanding the fact that the item, combination of items, or service is transferred between or among separate divisions, subsidiaries, or affiliates of a contractor; or
(h) A nondevelopmental item, if the procuring agency determines the item was developed exclusively at private expense and sold in substantial quantities, on a competitive basis, to multiple State and local governments.