5 - NOAA Acquisition Process Guide
Post-Award Module
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5.1 Notifications and Reporting Requirements
5.1.1 Notifications
5.1.1.1
Notice of
Contact Award (Synopsis)
5.1.1.2 Post-award Notification to Unsuccessful Offerors
5.1.1.3 Post-award Notifications to NOAA Office of Legislative Affairs
5.1.2 Reporting Requirements
5.1.2.1 Contractor Reporting of Executive
Compensation and First-Tier Subcontract Awards
5.2
Protests
5.2.1 Prevention
5.2.2 Protests to the Agency
5.2.3 Protests to GAO
5.2.4 Protests to the U.S. Court of Federal Claims
5.4 Monitoring Contractor Performance
5.4.1 Contracting Officer’s Oversight
5.4.2
Contracting
Officer’s Representative (COR) Responsibilities
5.4.2.1
COR
Duties
5.4.2.2 COR Limitations
5.4.2.3
COR Records
5.4.3 Assessing Contractor Performance
5.5
Delivery
Orders/Task Orders
5.5.1
Delivery
Orders/Task Orders Under Multiple Award Contracts
5.5.1.1 Fair Opportunity
5.6
Modifications
5.6.1 Simplified Acquisition Process
5.6.2 Consideration
5.7
Options
5.7.1 SBA Size Recertification
5.7.2 Small Business Size Re-Representation – Long-Term Contracts
5.8
Stop-Work Order
5.9
Change Orders
5.9.1 Documentation of Contract Modifications –
Change Order
5.9.2 Change Orders as Modifications to Purchase
Orders (PO) s
5.10
Claims and Requests
for Equitable Adjustments
5.10.1 Claims versus Request for Equitable Adjustment
5.10.2 Requirements for a Claim
5.10.3 Procedures for Handing a Request for Equitable
Adjustment or Claim
5.10.4 Release of Claims
5.10.5 Alternative Dispute Resolution
5.10.6 Contracting Officer’s Final Decision
5.11 Terminations
5.11.1
Termination
for Default
5.11.2 Termination for Convenience
5.11.3
Termination of
Commercial Contracts
5.11.3.1 Commercial Termination for Cause
5.11.3.2 Commercial Termination for the Government’s Convenience
5.12
Ratification of
Unauthorized Commitments
5.13
Completion,
Closeout, and File Retention
5.13.1 Contract File Retention
5.13.2 Maintenance
5.13.3 File Documentation for GSA FSS Orders
5.13.4 Close-Out
5.14 Summary of Post-Award
Section References
The administration of purchases under simplified acquisitions begins immediately upon award. The Contracting Officer determines the simplified acquisition method to use, monitors payments, communicates with the Vendor, ensures (to the maximum extent possible) timely delivery and satisfactory Contractor performance, oversees inspection and acceptance, and awards modifications as requirements change. At the time of contract close-out, the Contracting Officer performs all necessary activities, ensuring that the contract file is documented and retained for the appropriate period of time, as specified in FAR 4.805.
The Contracting Officer and Customer/Project Officer have
significant contract administration, program management, and technical
responsibilities after a contract has been awarded. This includes responding to
possible post award protests, issuing task and delivery orders, processing
modifications, and monitoring Contractor performance.
5.1 Notifications and Reporting Requirements
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5.1.1 Notifications
Top of Page
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5.1.1.1 Notice of Contract Award (Synopsis) Top of Page
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All awards exceeding $25,000 must
be synopsized (see FAR
5.303) unless an exception exists as
outlined in FAR
5.303(a).
The Contracting Officer publishes the notice of contract award via
synopsis to Federal Business Opportunities (FedBizOpps) at www.fedbizopps.gov.
Ensure contractual actions funded
in whole or in part by the American Recovery and
Reinvestment Act of 2009 (ARRA) comply with the
reporting requirements of PM 2009-09 (Amendment 1).
Following a contract award, the
Contracting Officer may, on behalf of Contractors, choose to publish a notice
of subcontracting opportunity in order to seek competition for subcontracts, to
increase participation by qualified HUB Zone small business, small, small
disadvantaged, women-owned small business, veteran-owned small business and
service-disabled veteran-owned small business concerns, and to meet established
subcontracting plan goals. See FAR
5.206.
5.1.1.2 Notifications to Unsuccessful
Offerors Top of Page
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The Contracting Officer shall provide written notification to each unsuccessful Offeror (not previously notified) within three days after the date of contract award (see Sample Notification to Unsuccessful Offeror Letter).. The notice shall include the following:
Note: In no event shall an Offeror’s cost breakdown, profit, overhead rates, trade secrets, manufacturing processes and techniques, or other confidential business information be disclosed to any other Offeror.
For Solicitations using Simplified Acquisition Procedures (SAP) under FAR 13, the Contracting Officer shall furnish the above information upon request by unsuccessful Offerors.
The Contracting Officer shall also furnish the above information upon request by unsuccessful Offerors who received a Pre-award Notice of Exclusion. For more information, see FAR 15.503.
While not required for Solicitations using SAP, the Contracting Officer shall furnish notices upon request by unsuccessful Offerors. Only the name of the awardee, the award price (including discount terms), and a brief explanation of the basis for award should be included in the notification.
For orders placed against a Federal Supply Schedule (FSS) contract, a brief explanation of the basis for award shall be provided if an unsuccessful Offeror requests information (only applicable to awards that are based on factors other than price alone). It may be in the NOAA’s best interest to provide unsuccessful FSS Vendor information about the evaluation of the Vendor’s offer (to avoid a potential protest and/or provide the Vendor relevant information that may improve its competitive capabilities for future NOAA requirements). A best practice that has been successful on prior FSS acquisitions has been to communicate relevant information regarding the Government’s evaluation of an unsuccessful FSS Vendor’s offer, in writing, when providing notice to a Vendor that it was not the successful Offeror.
5.1.1.3 Post-Award Notifications to NOAA Office of Legislative
Affairs
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Top of Page
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Commerce Acquisition Manual Chapter 1305.303 establishes policy regarding Department of Commerce Announcement of Contract Awards for all awards ≥ $3.5 Million over the life of the contract (inclusive of options and/or the estimated total quantity for a Requirements-type contract and/or the guaranteed minimum quantity for an Indefinite Delivery contract. This policy is also applicable to orders placed under Federal Supply Schedules (FSS), Government-Wide Acquisition Contracts, Multi-Agency Contracts, and Blanket Purchase Agreements established by NOAA acquisition offices against FSS contracts) and awards of any dollar value made pursuant to American Recovery and Reinvestment Act (ARRA). Acquisition Alert AA10-01 dated 4/28/2010 establishes procedures for implementing the Commerce Acquisition Manual.
COs shall submit Post-Award Notices (NOAA Acquisition Alert 10-01, Attachment 3), directly to OLA on the day of contract award to the maximum extent possible, but no later than 9:00 a.m. Eastern Time on the next business day after the day of contract award. The notice shall be prepared in the format provided at Attachment 3. The notice and a copy of the first page of the award document shall be combined into one pdf file and submitted via email to the following addresses:
“TO” addressees: Michael.Jarvis@noaa.gov; Timothy.Bagley@noaa.gov;
David.P.Miller@noaa.gov; Jennifer.Austin@noaa.gov
“CC” addressee: John.J.Abbott@noaa.gov
Subject: Post-Award Notice
5.1.2 Reporting Requirements Top of Page
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5.1.2.1 Contractor Reporting of Executive Compensation and First-Tier Subcontract Awards Top of Page
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FAR 4.14 requires contractors to report subcontract award data and the total compensation of the five most highly compensated executives of the contractor and the subcontractor. Public Law 109-282 (as amended by P.L. 110-252) requires all reported information to be made public; therefore, the contractor is responsible for notifying its subcontractors that the required information will be made public. The public may view first-tier subcontract award data at http://www.usaspending.gov. The Contracting Officer shall insert FAR 52.204-10 in all solicitations and contracts of $25,000 or more, including commercial item contracts and contracts for commercially available off-the-shelf items (except that solicitations or contracts that are classified or are with individuals are exempt from this requirement). Contractors awarded contracts funded with ARRA funds are also exempt from this reporting requirement. Contracting Officers are encouraged to review Acquisition Alert (AA) 11-01, which further explains the applicability of this requirement, specifically the need to modify existing IDIQ contracts or other ordering vehicles to cover future orders. Agencies shall ensure that contractors comply with the requirements of FAR clause 52.204-10, Reporting Executive Compensation and First-Tier Subcontract Awards. When Contracting Officers report the contract action to the Federal Procurement Data System (FPDS), certain data will then pre-populate from FPDS to assist contractors in completing and submitting their reports. Unless otherwise directed by the Contracting Officer, by the end of the month following the month of award of a first-tier subcontract with a value of $25,000 or more, (and any modifications to these subcontracts that change previously reported data), the contractor shall report the information required by FAR 52.204-10 at http://www.fsrs.gov for each first-tier subcontract. (The contractor shall follow the instructions at the website to report the data). By the end of the month following the month of a contract award, and annually thereafter, the contractor shall report the names and total compensation of each of the five most highly compensated executives for the contractor's preceding completed fiscal year at http://www.ccr.gov if the conditions at paragraph 2 of FAR clause 52.204-10 are met. Unless otherwise directed by the Contracting Officer, by the end of the month following the month of a first-tier subcontract with a value of $25,000 or more, and annually thereafter, the contractor shall report the names and total compensation of each of the five most highly compensated executives for each first-tier subcontractor for the subcontractor's preceding completed fiscal year at http://www.fsrs.gov if the conditions at paragraph 3 of FAR clause 52.204-10 are met. A contractor is exempt from the requirement to report subcontractor awards if in the previous tax year the contractor's gross income from all sources was under $300,000. Also, if a subcontractor in the previous tax year has gross income from all sources under $300,000, the contractor does not need to report awards to that subcontractor.
Agencies shall review contractor reports at http://www.fsrs.gov on a quarterly basis to ensure the information is consistent with contract information. NOAA Acquisition Alert (AA) 11-01 assigns responsibility for this task to Contracting Officers and provides examples of the type of information the Contracting Officer is and is not responsible for verifying. For example, the agency is not required to address data for which the agency normally would not have supporting information, such as the compensation information required of contractors and fist-tier subcontractors. However, the agency shall inform the contractor of any inconsistencies and require the contractor to correct the report or provide a reasonable explanation why it believes the information is correct. If the contractor fails to comply with the reporting requirements, the Contracting Officer shall exercise appropriate contractual remedies. In addition, the Contracting Officer shall make the contractor's failure to comply with the reporting requirements a part of the contractor's performance information under FAR 42.15.
Phase-in of reporting of subcontracts of $25,000 or more shall be accomplished according to the following schedule:
·
Beginning
July 8, 2010 until September 30, 2010, any newly awarded subcontract must be
reported if the prime contract award amount was $20,000,000 or more.
·
From
October 1, 2010 until February 28, 2011, any newly awarded subcontract must be
reported if the prime contract award amount was $550,000 or more.
·
Beginning March 2, 2011, any newly awarded
subcontract must be reported if the prime contract award amount was $25,000 or
more.
5.2
Protests
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An
unsuccessful Offeror may file a post award protest with one or more of the
following entities: the Agency (NOAA Contracting Officer or at a level above
the Contracting Officer with the Protest Decision Authority per CAR
1352.233-71), the Government Accountability
Office (GAO), or the U.S. Court of
Federal Claims (COFC).
Contracting
personnel shall work with the Protest Control Officer (PCO) and the DOC Office of General
Council, Contract Law Division (OGC CLD) attorney to resolve protests.
The AGO’s Policy Coordinator serves as the liaison/point of
contact for protests filed with the General Accounting Office (GAO) and the
agency. The AGO Policy Coordinator acts as NOAA’s PCO. The PCO can also act as
an independent reviewer as allowed in FAR
33.103(d)(4). The PCO’s mailing address and contact numbers are:
National Oceanic and Atmospheric
Administration
Acquisition and Grants Office
Phone Number: (301) 713-0325
FAX: (301) 713-1974
Coordinate all protests with DOC OGC CLD, the cognizant
legal counsel for contractual issues. The mailing address and contact numbers
are:
U. S. Department of Commerce
Office of General Counsel
Contract Law Division, Room 5893
Attn: Mark Langstein, Esquire
FAX 202-482-5858
In addition, Contracting Officers shall notify OAM of all protests, lawsuits or appeals filed relating to a DOC contract action within one business day from receipt of such notification. Contracting Officers shall also provide OAM a copy all protests/lawsuits and responses to those protests/lawsuits within one week after responses are submitted. (See DAO 208-05, PM 2010-04, PM 2010-10, and Acquisition Alert 05 - Revised Legal Review Thresholds): The copies and responses shall be forwarded to the following office:
U. S. Department of Commerce
Office of Acquisition Management
Attn: Senior Procurement Executive
1401 Constitution Avenue, NW
HCHB Room 6422
Wasthington, DC 20230
If the Contracting Officer receives an untimely protest, the Contracting Officer need not suspend contract performance or terminate the awarded contract unless the Contracting Officer believes that an award may be invalidated and a delay in receiving the supplies or services is not prejudicial to the Government’s interests.
5.2.1
Prevention Top of Page
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Contracting
Officers can minimize the risk of protests by 1) adhering to the Source
Selection Plan (SSP), Section M of the RFP, and all FAR and other regulatory
guidance; 2) involving Counsel early in the procurement process; and 3)
conducting a well-documented source selection.
Prior to submission of agency-level
protests, all parties should use their best efforts to resolve concerns raised
by an interested party at the Contracting Officer level through open and frank
discussions.
The NOAA encourages the use
of Alternative Dispute Resolution (ADR). FAR 33.201 defines ADR as "any type of procedure or
combination of procedures voluntarily used to resolve issues in controversy.
These procedures may include, but are not limited to, conciliation, facilitation,
mediation, fact-finding, mini-trials, arbitration, and use of ombudsmen. Where appropriate, the use of
third party neutrals and another agency’s personnel are also acceptable protest
resolution methods.
If the protest reveals that
an award does not comply with the requirements of law or regulation, the
Government may be required to pay to the protester the cost, exclusive of
profit, of filing and pursuing the protest, including reasonable attorney,
consultant, and expert witness fees, and in some instances bid and proposal
preparation costs. Where a post award protest is sustained as the result of an
awardee’s intentional or negligent misstatement, misrepresentation, or
miscertification, the awardee may be required to reimburse the Government’s
costs. In addition to any other remedy available, the Government may collect
this debt by offsetting the amount against any payment due the awardee under
any contract between the awardee and the Government. For more information, see FAR 33.102.
5.2.2 Protests to the Agency Top of Page
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FAR 33.103(d)(4) allows interested parties to request an
independent review of their protest. In the solicitation, state how and who will
conduct the independent review. Generally, the solicitation will identify the
PCO as the independent reviewer and that the review will be performed after the
CO’s review.
Coordinate all protests received
before award, even those that appear to be groundless, with the PCO and DOC OGC
CLD. The DOC OGC CLD attorney will work with the cognizant Contract
Specialist/CO and COR and offer advice as to the appropriate action. Before
responding to the protester, obtain the concurrence of the PCO and DOC OGC CLD.
In accordance with FAR 33.103(f)(1), the cognizant HCO unless the HCO is the
CO, in which case the SBPO can make this determination, is authorized to make
the determination to award a contract, in spite of the protest, after obtaining
the concurrence of the PCO and DOC OGC CLD.
Coordinate
all protests received after award, even those which appear to be groundless,
with the PCO and DOC OGC CLD. The DOC OGC CLD attorney will work with the
cognizant Contract Specialist/CO and COR and offer advice as to the appropriate
action. Before responding to the protester, obtain the concurrence of the PCO
and DOC OGC CLD. In accordance with FAR
33.103(f)(3), the cognizant HCO unless the HCO is the CO, in which case the
SBPO can make this
determination, is authorized to make the determination to award a contract, in
spite of the protest, after obtaining the concurrence of the PCO and DOC OGC
CLD.
Protests must be filed
no later than 10 calendar days after the basis of the protest is known or
should have been known, whichever is earlier. The Contracting Officer may consider
any protests not filed in a timely manner if the protest reveals significant
issues with the awarded contract or NOAA’s acquisition system.
For more information on post award protests to the Agency,
see FAR 33.103 and CAR Part 1333.
5.2.3 Protests to GAO
Top of Page
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Protests to the GAO must be filed no later than 10 calendar days after the award of the contract or five days after a debriefing date offered to the protester for any debriefing required by FAR 15.505 or FAR 15.506, whichever is later.
If it is believed performance
should be allowed to continue in spite of the protest, the cognizant CS
prepares a finding, and forwards it for PCO concurrence, along with a written
request for HCA approval. Furnish a copy concurrently to the DOC OGC CLD. If
the HCA approves continued performance, DOC OGC CLD will notify GAO of the
findings. (See Sample D&F to Continue Performance in the Face of a GAO
Protest.)
For more information see APG Award Module Section 4.3.3
5.2.4 Protests to the U.S. Court of Federal Claims Top of Page
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If the
contractor has appealed to the U. S.
Court of Federal Claims, the U.S. Department of Justice will represent the
Agency. However, coordination of all actions through the Department of
Commerce, Office of General Counsel, Contract Law Division must continue.
5.3 Conferences
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A post-award conference includes Government and Contractor personnel and is held as soon as possible (typically within 30 days) after contract award to foster clear and mutual understanding of all contract requirements and to identify and resolve potential problems. The post-award conference may be held at either the Contractor or Government facility and may be held via a conference call if the circumstances warrant.
The Administrative Contracting Officer (ACO) arranges and conducts post-award conferences to review contractual requirements and responsibilities with all interested parties. post-award conferences are not used to alter final agreements negotiated prior to award.
Formal post-award conferences are not always necessary in situations in which, e.g., an incumbent or sole-source situation exists such that the players are known or unchanged, or if the Contractor performed satisfactorily on a recent, similar contract. In accordance with FAR 42.502, the Contracting Officer (in some cases the ACO) will determine if a post-award conference is needed and the extent of formal proceedings.
The objectives of a post-award conference do not have to be met in a face-to-face environment. Regardless of the forum, post-award conferences must be documented and the record maintained in the contract file. A record of participants/attendees should also be included. Areas typically addressed include the following:
· Contract type
· Delivery order procedures
· Contracting Officer’s authority
· Unauthorized commitments
· Contracting Officer’s Representative (COR) responsibilities and limitations
· Contractor Performance Reporting
· Invoicing and certification procedures
· Transportation procedures
The following individuals may attend the Post-Award Conference:
· ACO
· Contractor personnel
· COR
· Project Officer – including the PM, Business Financial Manager (BFM), engineering staff, logistics staff, and critical Contractor support
· Counsel
Prior to the conference,
the ACO should convene a meeting of the Government representatives to identify
all issues and topics to be discussed as well as establish a unified Government
position. During the conference, the ACO will introduce the teams, establish
ground rules for future communications, and ensure all agenda items are
addressed.
If a Post-Award Conference is anticipated and may result in associated travel costs incurred by the Contractor, the Contracting Officer will identify this requirement in the Solicitation so that offerors may include this cost in their offer.
The prime Contractor may invite its key subcontractors to attend the post-award conference. The prime Contractor may conduct a separate post award conference with its subcontractors to which Government representatives may or may not be invited.
5.4 Monitoring Contractor Performance
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From the commencement of Contractor performance, the Contracting and Project Officer are responsible for ensuring, to the greatest extent possible, that contract performance is on time and within budget. Awareness of both technical and financial status and progress is crucial.
Performance data gathered by the Contracting Officer, or his/her designated representative, must be formally recorded annually. This formal record benefits the Contractor by providing insight into perceived performance; the Government by allowing a medium for accountability and presenting expectations; and future contracts, with the same Contractor or similar in scope, by identifying lessons learned.
There is no prescription for standard monitoring of Contractor performance. Contracts for the same supply or service may differ in dollar value and personnel (Contractor or Government); contracts with the same Contractor may differ in complexity and scope. A vigilant Contracting Officer monitors technical performance, maintains awareness of financial status, and identifies and mitigates risk throughout the life of the contract.
5.4.1 Contracting Officer’s Oversight Top of Page |
In
accordance with CAM 1301.67 Contracting Officers shall provide input to COR
supervisors at the end of each contracts performance (See Sample COR Performance Evaluation).
In addition, the Contracting Officer may perform reviews of the COR contract files on an “as needed” basis. Issues/events that the Contracting Officer may consider when deciding whether a review is needed are:
§
Designation of a
new COTR/ACOTR on the contract.
§
Contractor
receipt of an overall CPR rating of unsatisfactory or marginal, or when a
Termination for Default is being contemplated.
§
A pattern of
problems with COR performance in any area of responsibility, e.g.:
o
Unauthorized
commitment
o
Untimely/poor
quality modification SOWs/Independent Government Cost Estimates (IGCEs)
o
Inadequate/non-existent
invoice reviews
o
Untimely/poor
quality CPR recommendations
o
Complaints
regarding monitoring of Contractor performance or requesting Contractor
performance outside the scope of the contract (constructive changes)
5.4.2 Contracting Officer’s Representative (COR) Responsibilities Top of Page |
Rarely will a Contracting Officer have the expertise in all facets of every procurement he or she administers to ensure a successful contract. To assist in technical monitoring and administration of a contract, Contracting Officers may designate qualified personnel as their authorized representatives. These individuals, known as Contracting Officer's Representatives (CORs), must be technically qualified and properly trained before assuming responsibilities such as monitoring receipt of contract deliverables, verifying the accuracy of contract invoices, and monitoring contract expenditures. An Alternate COR (ACOR) may also be assigned to a contract if the Contracting Officer determines that it is required in order to provide proper surveillance and oversight.
A COR is said to be the “eyes and ears” of the Contracting Officer and rightfully so. A COR is frequently on-site with the Contractor, performing the monitoring, surveillance, and oversight of the contract, and is otherwise the individual designated to perform inspections, verify the accuracy of contract invoices, receive and accept goods, and monitor contract expenditures. As such, the COR’s role is integral to the success of the contract and its overall administration. A COR acts as the technical liaison between the NOAA and the Contractor regarding the Statement(s) of Work and/or Specification(s) under a contract, and is essential in communicating potential problems to the Contracting Officer for mitigation and immediate diffusion before a situation becomes problematic.
5.4.2.1 COR Duties Top of Page
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A COR’s responsibilities are commensurate with the complexity, value, technical direction, and monitoring required for a given contract and are specified in the COTR Appointment Memorandum. The COR shall perform the duties and comply with the responsibilities and limitations specified in the Memorandum including the documentation of actions taken under such delegation of authority. In general, a COR shall:
·
Act as technical
liaison between the Contracting Officer and the Contractor with respect to
monitoring the Contractor’s performance against the contract Specification,
Statement of Work (SOW), and Quality Assurance Surveillance Plans (QASP) and
communicating any potential problems with the Contracting Officer. The COR
utilizes the QASP in conducting surveillance and oversight of Contractor
performance for service contracts. The QASP generally contains the specific
Contractor outcomes/objectives, performance standards, any incentives, and
methods of surveillance. The COR measures the degree by which the Contractor is
satisfying these objectives and measurable standards (i.e., terms of quality,
timeliness, quantity, etc.). When Contractor performance fails to meet contract
requirements, the COR shall immediately communicate such deficiencies to the
Contracting Officer, may consider recommending to the Contracting Officer
resultant reductions of fee or price in accordance with the QASP, and shall
document in the COR file all communications and actions taken (See also FAR 37.6 and Sample QASP for CPFF Contract).
·
Monitor the Contractor’s
progress, costs and quality of performance and keep the Contracting Officer
informed. A simple Contract Funding Summary Spreadsheet can prove to be a
useful tool for the COTR to help the Contracting Officer track funding after
contract award and throughout the life of the contract/orders, whether firm
fixed, cost plus award fee, or cost plus fixed fee. On cost reimbursable contracts,
if a Contractor exceeds the funded amount on contract, the Contracting Officer
must immediately issue a letter notifying the Contractor of non-compliance. The
Contracting Officer often relies upon information provided by the COTR to issue
such letters in a timely manner. (See Limitation of Funds Non-Compliance Letter Template.)
·
Promptly report
any substantive deficiencies in contract performance or other instances of
noncompliance with contract terms and conditions to the Contracting Officer.
·
Provide reports
of, and documentation to support, significant actions taken as directed.
·
Review and
certify the Contractor’s invoices to ensure that work cited has been performed
and that labor hours, materials and travel charged are consistent and
reasonable for the effort completed during the period covered by the invoice.
·
If the contract
specifies a labor mix/level of effort, monitor the actual labor mix/level of
effort expended and periodically report significant differences between the
contracted and actual incurred labor mix/level of effort expended to the
Contracting Officer. This allows a more realistic labor mix/level of effort estimation,
more realistic pricing for subsequent contracts, and also helps to reduce the
risk of Contractor-proposed uncompensated overtime on future contracts.
·
Where work under
a contract is assigned by task order or delivery order, track performance,
labor hours and mix ordered, and labor hours and mix expended by individual
orders.
·
Be alert to
inconsistencies between work actually performed by the Contractor and
performance claimed on invoices, as well as inefficiencies of the Contractor,
and promptly notify the Contracting Officer when such circumstances occur.
·
Review, inspect,
and accept services or deliverables when completed, unless otherwise specified
in the contract, and certify when all deliverables have been accepted.
·
Maintain a COR
file for each contract/order assigned which contains documentation relative to
the actions taken by the COR. Electronic files are acceptable as an alternative
to hard copy files. However, backing up electronic files regularly is highly
recommended. The importance of maintaining complete and orderly files cannot be
overemphasized, and it is critical to ensure transfer of responsibility if the
COR is changed during the term of the contract. As a matter of practice, the
COR shall prepare Memoranda for Record (MFRs) of meetings, trips, and telephone
conversations relating to the contract. Each MFR, other similar records, and
correspondence relating to the contract shall cite the applicable
contract/order/modification number. See also the COR File Documentation Checklist.
·
Ensure that the
Government is getting what it pays for.
·
As the assessing
official, the COR shall prepare a quality narrative and rating on the
Contractor's performance. CORs play a significant role in the Contractor
Performance Report (CPR) process for collection of past performance information
used in source selection evaluations. The CPR assesses a Contractor’s
performance and provides a record, both positive and negative, on a given
contract for a specified period of time. Each assessment is based on objective
facts and is supported by program and contract management data.
5.4.2.2 COR Limitations Top of Page
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The
COR is held to limitations as specified in the COR Designation Memorandum. In
general, the COR should ensure the following actions do not occur:
§
Promising or authorizing
the Contractor to perform additional work (COR shall not issue orders or change
the intent or substance of a contract or order).*
§
Issuing stop work
orders.
§
Authorizing
additional Government Furnished Property (GFP) outside of the existing terms of
the contract/order.
§
Disclosing source
selection or proprietary information.
§
Providing any
budgetary information.
§
Allowing or
authorizing personal services. The COR shall maintain an arms-length
relationship with Contractor employees.**
§
Interfering with
Contractor’s personnel practices or organized labor.
§
Directly or
indirectly changing the following:
o
Pricing, Cost or
Fee
o
Quantities
o
Quality
o
Scope of the
Task/Delivery Order/Contract/Modification.
o
Delivery
Schedule.
o
Labor Mix.
o
Any other
terms/conditions of the Order/Contract/Modification.
§
Nurturing a
conflict of interest or appearance of a conflict of interest. The COR shall
adhere to the statutes and regulations governing standards of conduct. If a
conflict or the perception of a conflict of interest develops, the COR shall
notify the designating Contracting Officer and Field Counsel immediately.
(*) What is a constructive
change? Why should it be avoided?
A constructive change is an action (or inaction) on the part of the Government, which results in Contractor performance different from, or in excess of, the original contract requirements. In other words, a constructive change is a change that is outside the scope of the contract or requested informally by someone other than the Contracting Officer without the official contract modification to make it part of the contract. Occasionally, CORs inadvertently make changes to the contract by making verbal changes in Specifications, accelerating delivery dates or requiring more stringent quality assurance, for example. Such changes often result in invoices over and above the original contract amount. Only Contracting Officers, acting within their delegated contracting authority, are empowered to make such changes by means of negotiations and formal contract modifications. Nevertheless, Contractors often act on changes requested by the COR because it appears to the Contractor that the COR has authority to change contracts. The result is an unauthorized commitment that requires ratification. See APG Section 5.12 for Ratification of Unauthorized Commitments.
(**) What are personal
services? Why should they be avoided? How can they be prevented?
In a personal services contract, Contractor personnel appear, in effect, to be Government employees. Personal services contracts usually involve continuous direct supervision and control of Contractor employees by Government employees. Obtaining personal services by contract, rather than by direct hire, circumvents civil service laws unless Congress has specifically authorized acquisition of the services by contract. In order to prevent a personal services contract from occurring, the contract Statement of Work must be well defined and precise. The COR must maintain surveillance, not supervision, and he/she must notify the Contracting Officer at the first indication of a problem with Contractor performance.
5.4.2.3 COR Records Top of Page
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Since the COR is an authorized representative of the Contracting Officer, the COR’s records are a part of the official (post award) contract files and shall be forwarded to the Contracting Officer for retirement with the official contract file upon completion of the contract. Documents that pertain to the contract shall be clearly identified when forwarded to the Contracting Officer. Documents that may contain Contractor proprietary data or other source selection sensitive information should not be released outside the Government without prior approval from the Contracting Officer.
5.4.3 Assessing Contractor Performance Top of Page |
FAR 42 mandates that past performance data be collected for
each contract, task order, or delivery order that exceeds the simplified
acquisition threshold, including FSS’s, GWACs, MACs and DOC IDCs, with the
exception of architect/engineering services contracts ($30K or more or any
defaulted contracts) and construction contracts ($550K or more or any defaulted
contracts). A contractor performance
evaluation shall be completed as soon as practicable after completion of the contract,
but not later than 30 days after the completion date. In addition, this policy is not applicable to
orders/contracts awarded pursuant to FAR
8.7.
In addition to the final evaluation, at least one
interim evaluation shall be submitted by the Contracting Officer on all
contracts with a period of performance exceeding one year. For all multi-year contracts, interim reports
must be submitted once per year at a minimum.
A Final CPR is executed at contract termination, delivery of the final
major end item, or completion of the period of performance.
All contractor performance evaluation information is treated as source
selection information in accordance with FAR
3.104. This information sometimes includes information that is proprietary,
such as trade secrets and confidential commercial or financial data that would
not be released under the Freedom of Information Act.
CPARS is Department of Defense’s (DOD’s) Contractor Past Performance Assessment Reporting System (CPARS). CPARS is DOD’s automated feeder system used by DOC to document contractor performance on systems and non-systems contracts including services, information technology, operations support, systems, ship repair and overhaul. To review and publish past performance information in PPIRS. The Past Performance Information Retrieval System (PPIRS) is the Federal Government’s repository site for all contractor performance evaluation information to be generated and retrieved by all federal agencies. The CPARS reports are transmitted to PPIRS, which provides past delivery and quality performance information contracts/orders for use in the source selection process. The contractor performance evaluation report or PPIRS-Report Card (PPIRS-RC) provides a record of the Contractor’s performance, both positive and negative, on a given contract during a specific period of time. Each assessment is based on objective facts and supported by program and contract management data, such as the following:
· Cost performance reports.
· Customer comments.
· Quality reviews.
· Technical interchange meetings.
· Financial solvency assessments.
· Construction/production management reviews.
· Contractor operations reviews.
· Functional performance evaluations.
· Earned contract incentives.
The purpose of CPARS and PPIRS is to ensure that contractor performance data are appropriately assessed and that feedback regarding performance is conveyed to companies with whom the NOAA has contracted. The PPIRS-RC is a “report card” on how well a Contractor is performing or has performed on an individual contract.
At appropriate periods throughout the life of the contract (including option exercises, warranty periods, and delivery of deferred data, if any), the CO, with the assistance of the COTR, will prepare a contractor performance evaluation on contracts above the simplified acquisition threshold. The Assessing Official is encouraged to seek input from the multi-functional acquisition team when assessing the contractor’s performance. At a minimum, Contracting Officer input should be obtained.
Note: Contracting Officers should
ensure that support contractors do not
prepare inputs to CPARS (even as project team members) and do not have access to
CPARS. See FAR 7.503(d)(7).
Urgent Timeframe/Reporting Requirement for Other Contractor Information: FAR 42.1503(f) (1) mandates that agencies shall ensure information is reported in the FAPIIS module of PPIRS within 3 working days after a Contracting Officer:
FAR 42.1503(f)(2) directs agencies to establish focal points and register users to report data into the FAPIIS module of PPIRS (available at www.cpars.csd.disa.mil, then select FAPIIS). Instructions on reporting are available at www.ppirs.gov and at http://www.ppirs.gov/fapiis.html.
For further information, also see CAM 1342.15; OFPP’s “Best Practices for Collecting and Using Current and Past Performance Information”; and - the Office of the Under Secretary of Defense for Acquisition, Technology and Logistics (AT&L) (Defense Procurement and Acquisition Policy) put together “A Guide to Collection and Use of Past Performance Information (Version 3)” that, although not entirely applicable to civilian agencies, in particular Business Sectors, is an overall informative and useful tool.
The contract clause, entitled, "Contractor Performance Evaluation" shall be included
in all solicitations and contracts over the SAT.
5.5 Delivery/Task Orders
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The work statement included in a Contract details the
programs and projects under which supplies or services may be
provided/performed, but the specifics of the supplies or services frequently
require further amplification by means of issuance of delivery and task orders.
FAR 2.101 defines a delivery order (DO) as an “order for
supplies placed against an established contract or with Government sources.” A
task order (TO) is essentially the same as a DO, but for services as opposed to
supplies.
Indefinite Delivery Contracts (IDCs) allows the acquisition of supplies and/or services when the exact times and/or exact quantities of future deliveries are not known at the time of contract award. IDCs are also known as delivery order, task order, or “D-type” contracts. Examples of IDC contracts include Indefinite-Delivery/Indefinite-Quantity (IDIQ), Indefinite-Delivery/Definite-Quantity, and Requirements contracts. IDC contracts may be single or Multiple Award Contracts (MACs). DOs/TOs may be Fixed Price (FP), Cost Reimbursement (CR), Time-and-Materials (T&M), labor-hour, or some combination of these arrangements, as stated in the contract. (See APG Planning Module Section 1.6.)
In accordance with FAR 16.505, DOs/TOs issued under IDIQ contracts must contain the following:
In addition to the information
required by the FAR, if the order is for services the Project Officer should
provide a detailed description of the services being procured to ensure that
Project Officer and Contractor expectations for the specific tasking are
aligned. Descriptions should be thorough enough to allow the Comptroller to
validate requirements against budgeted appropriations. The Project Officer is
responsible for initiating a DO by processing a request in C-Request. As indicated by FAR 32.703-3, a TO for severable services may have a period
of performance that crosses fiscal years if the period of performance does not
exceed one year.
The Contracting
Officer shall document in the contract file the rationale for placement and
price of each order, including the basis for award and the rationale for any
tradeoffs among cost or price and non-cost considerations in making the award
decision.
5.5.1 Delivery/Task Orders Under Multiple Award Contracts Top of Page |
All services acquired under IDIQ Multiple Award Contracts (MACs) are provided through award of task orders (TOs). FAR 16.505 (b) provides general guidance on issuing orders. The following are suggested procedures for issuing a competitive multiple award task order (see Multiple Award Task Order Competition Procedures Flowchart and for more information see OFPP’s Best Practices for Multiple Award Task and Delivery Order Contracting, Updated February 19, 1999).
Identify Requirement. The Contracting Officer must provide each awardee a fair opportunity to be considered for each order exceeding $3,000 issued under multiple delivery order contracts or multiple task order contracts. For exceptions to the fair opportunity process, see APG 5.5.1.1.
Document Fair
Opportunity Exception, if applicable. Every order shall identify the basis if using an exception to MAC fair
opportunity requirements. The Project/Program Officer may initiate a request
for exception to fair opportunity by submitting a written request to the
Contracting Officer. (see Memo Requesting Exception to Fair Opportunity.) For
MAC orders exceeding $100,000 that do
not provide fair opportunity, the Contracting Officer must execute a
justification that is prepared and approved in accordance with FAR 8.405-6 and includes a written determination that
addresses one of the exceptions as described above.
Develop Evaluation Plan. The Project/Program Officer sends draft evaluation factors and scoring criteria to the Contracting Officer for review.
Send Drafts to MAC
Contractors. Time permitting, following review and comment, the Contracting
Officer may forward the draft evaluation factors along with the draft
specification/statement of work to the multiple award contract holders for
their review.
Provide Questions and
Answers. Comments and questions are
sent in to the Contracting Officer, which are then consolidated into a
Questions and Answers (Q&A) document provided to the MAC Contractors.
Issue Request for
Quote (RFQ). The specification/statement of
work and Q&A document are attached to the RFQ, and sent out to each MAC
Contractor electronically (may be sent via email).
Receive and Evaluate
Quote/Offer. The
Contracting Officer will coordinate a technical evaluation of the
offers, and the Project/Program Officer will then submit a subsequent technical
award recommendation to the Contracting Officer for final evaluation of
technical and other factors.
Award. Task or Delivery Order is prepared and awarded on Optional Form 347 (OF 347) Order for Supplies or Services or SF 1449 Solicitation/Contract/Order for Commercial Items..
Provide Award
Notification. The Contracting Officer provides notification
of award to all offerors, which includes the name of the awardee and price.
Debriefs are also considered at this time (not mandatory).
Ombudsman. DOs/TOs under MACs require an ombudsman per FAR 16.504(4)(v). The Ombudsman reviews complaints from Contractors and ensures all Contractors are afforded a fair opportunity to be considered, consistent with the procedures in the contract. The Ombudsman must be a senior agency official who is independent of the Contracting Officer and may be the Agency’s Competition Advocate (see FAR 16.505). For the NOAA, the Ombudsman is:
Team Lead, Performance Assessment & Improvement
Team, CAPPS
U. S. Department of Commerce
Office of Acquisition Management
202-482-3780
5.5.1.1 Fair Opportunity Top of Page
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Each awardee of a multiple-award IDIQ contract must be given a fair opportunity to be considered for each order exceeding $3,000 (see FAR 16.505(b)(1)). A fair opportunity occurs when the Government places orders on a competitive basis. An order exceeding $100,000 is considered to be placed on a competitive basis only if the Contracting Officer does the following:
The Contracting Officer should consider the following factors when developing procedures that will provide offerors a fair opportunity to be considered for each order: past performance on earlier orders, potential impact on other orders placed with the Contractor, minimum order requirements, amount of time Contractors need to make informed business decisions on whether to respond to potential orders, and whether Contractors could be encouraged to respond to potential orders by outreach efforts to promote exchanges of information.
Price/Cost must be considered under each order as one of the factors in the selection decision. Past performance under prior orders may also be considered. The Contracting Officer must document in the contract file the rationale for placement and price of each order, including the basis for the award and the rationale for any tradeoffs among cost/price and non-cost considerations in making the award decision.
Note that the Armed Services Board of Contract Appeals (ASBCA) recently held that, where a contract states that each multiple-award IDIQ Contractor would have a fair opportunity to compete for delivery/task orders, it has jurisdiction to determine whether the Contracting Officer considered the Contractor fairly for task orders. In contrast, the issuance, or proposed issuance, of an order under a single award DO/TO contract is not protestable at GAO, unless the protest is made on grounds that the order increased the scope, period, or maximum value of the contract. However, it should be noted that current regulations state that there is a preference for issuing multiple award IDIQ contracts and that the Contracting Officer must document a decision NOT to make multiple awards; it is not sufficient to determine that multiple awards are not viable simply to avoid the possibility of protest on DO/TO awards.
Exceptions. Exceptions to the fair opportunity process include
the following (see FAR 16.505(b)(2)):
· Award to any other source would likely result in substantial duplication of cost to the Government that is not expected to be recovered through competition;
· Award of the order to a different source would cause unacceptable delays in fulfilling the Government’s requirements (lack of advance planning is not valid rationale); or
· A Contractor is already at work on a site, and it would not be practical to allow another Contractor to work on the same site.
When using the logical follow-on exception, the Contracting Officer must specify how recent the previous competitive order was and the number of times this exception has been used; discuss why the specific requirement continues; and discuss why it would be of benefit to the Government for the specified Contractor to continue this work.
· It is necessary to place an order to satisfy a minimum guarantee.
5.6 Modifications
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Contract
modifications are executed whenever the basic terms and conditions, scope of
work, funding, or other contract components are revised in writing by the
Contracting Officer. Either the Government or a Contractor may propose to
modify a contract. If a Contractor initiates a modification, it must submit a
signed request to the Contracting Officer explaining the modification and its
anticipated effect on the contract. Only Contracting Officers acting within
their delegated authority are empowered to execute a contract modification or
change a contractual commitment on behalf of the Government.
Other Government personnel shall not act in such a manner as to cause the Contractor to believe that they have authority to bind the Government or direct or encourage the Contractor to perform work that should be the subject of a contract modification. Project Officers and Contracting Officer’s Representatives need to be careful to avoid “constructive changes.” A constructive change is a change that is outside the scope of the contract or requested informally without the official contract modification to make it part of the contract. Modifications must be approved prior to execution.
There are two types of
contract modifications: unilateral and bilateral. Unilateral modifications
are signed only by a Contracting Officer, and bilateral modifications
(supplemental agreements) are signed by both a Contracting Officer and a
Contractor. A bilateral modification can add new work or revise existing terms,
and it may have cost implications.
Bilateral. A bilateral modification (supplemental agreement) is a contract modification that is signed first by the Contractor and then by the Contracting Officer. Bilateral modifications are used to do the following:
· Make negotiated equitable adjustments resulting from the issuance of a change order.
· Definitize Letter Contracts.
· Reflect other agreements of the parties modifying the terms of contracts (e.g., no-cost Engineering Change Proposals (ECPs), revised delivery schedules, or periods of performance into the contract in return for consideration; providing additional funding under Undefinitized Contract Actions (UCAs) pursuant to the “Limitation of Government Liability” clause or for cost overruns pursuant to the “Limitation of Cost”/”Limitations of Funds clause; or determination of the final “price” of incentive contracts.)
Unilateral. A
unilateral modification is a contract modification that is signed only by the
Contracting Officer. Unilateral modifications are used, for example, to do the
following:
· Make administrative changes (written changes that do not affect the substantive rights of the parties; e.g., a change in the contract administration office, COR, paying office, or appropriation data).
· Make changes authorized by clauses other than a changes clause (e.g., incremental funding pursuant to the “Limitation of Funds” clause, exercising priced Options pursuant to Option exercise clauses in the contract; or other actions pursuant to the Government Property or Stop-Work Order clause); and
Note: If the modification includes incremental funding, it is necessary for the Contracting Officer and COR to work closely with the Comptroller. The funding should be appropriately broken out between the specifically identified Contract Line Item Numbers (CLINs) and even further between cost and fee, depending on the type of contract.
It is important to negotiate
priced modifications prior to commencement of performance rather than relying
on issuing a unilateral change order under the Changes clause. The Changes
clause allows a Contracting Officer to direct the Contractor to perform
within-scope changes to the contract (unilateral modification), but requires a
bilateral priced modification to be negotiated later (often in the form of a
Request for Equitable Adjustment (REA)). The Contracting Officer is generally
in a better negotiating position when the in-scope change is negotiated and the
contract modified prior to the work starting. There will be situations in
which there are unknowns or contingencies (urgent and compelling situation and
no time to negotiate upfront) involved and thus the Contracting Officer will
have to issue a unilateral mod under the Changes clause and negotiate later.
Contract modifications
include the following:
· A change order invokes a contract's Changes Clause for changes in general scope and must be approved by a Contracting Officer. A Contractor submits a written proposal in response to a change order. A unilateral modification is used to issue the change order. After negotiation, Contracting Officers determine whether an equitable adjustment is required, and execute a bilateral modification.
· For commercial contracts, in lieu of using a changes clause, “Mutual Agreement” of the parties is cited as the authority to make changes to price and quantity and authorize cancellations or partial cancellations. These modifications are issued as bilateral agreements.
· A modification adding new work outside the scope of the contract requires a justification for other than full and open competition and results in a bilateral modification. See also FAR 6.3, Other Than Full and Open Competition.
· An extension modification extends the period of performance for completion of contract requirements. This extension can be a cost or no-cost extension. A Contractor submits a written request or proposal identifying the impact of the extension on a contract and its funding. Contract extensions are bilateral modifications.
· A cost overrun modification is necessary when the cost of performing a cost-reimbursement contract exceeds or is expected to exceed the total estimated cost in the contract. A Contractor needs additional funding to complete requirements; no new work is performed. A cost overrun modification is bilateral. (See Limitation of Funds Non-Compliance Letter Template – issued by the Contracting Officer when the Contractor exceeds the funded amount on contract.)
· A modification changing other terms of the contract, such as travel, subcontracts, equipment, key personnel, delivery, or schedule, can be initiated by either a Contractor or the Government. A Contractor submits documentation requested by the Contracting Officer. These modifications are bilateral.
· A modification making changes authorized by clauses other than the changes clause, such as Property Clause, Options Clause, incremental funding, or Contracting Officer’s Representative, is initiated by the Government and may be executed as a unilateral modification.
· A modification making administrative changes that do not affect the rights of the parties, such as a change in the appropriation data or the paying office is initiated by the Government and may be executed as a unilateral modification.
See the DAU Material on Contract Modifications and Adjustments.
5.6.1 Simplified Acquisition Procedure (SAP) Modifications Top of Page |
Under SAP, the Contracting Officer will complete SF 30 Amendment of Solicitation / Modification of Contract when modifying an order/contract or when canceling a unilateral order. The SF 30 is a self-explanatory form with each block labeled for the information that needs to be provided. Each block should be filled out as applicable to the type of change order/modification being issued.
Block 13 identifies modification authority. When completing Block 13, an authority must be listed that allows for the type of change/modification being used.
Examples of authority for non-commercial contracts include the following:
· FAR 52.243-1.Changes – Fixed Price
· FAR 52.249-1 for termination or partial termination of fixed price contracts amount $100,000 or less.
· FAR 52.249-4 for termination or partial termination for service orders, regardless of contract value.
· FAR 43.103(a) (bilateral/supplemental agreement) or FAR 43.103(b) (unilateral).
Examples of authority for commercial contracts include the following:
· FAR 43.103(a) (bilateral/supplemental agreement) or FAR 43.103(b) (unilateral).
· Cite “Mutual Agreement” of the parties for changes (non-administrative).
· FAR 52.212-4 for other changes.
When completing Block 13, the Contracting Officer will complete one of four fields to identify the proper authority:
13A. This block is used when issuing a change order. An example of a change order would be changing place of delivery or changing a Specification.
13B. Use this block when making an administrative change to the order. An example of an administrative change would be changing Vendor address or changing accounting data.
13C. Use this block when issuing a supplemental agreement/mutual agreement.
13D. Use this block for all other changes not included above. These changes are normally bilateral. Examples of other changes are termination or partial termination, cancellations, increases in quantity to conform to unit packs.
5.6.2 Consideration Top of Page |
Modifications to a contract affect the interests, rights, and obligations of two independent parties: the NOAA and the Contractor. The responsibility of the Contracting Officer is to preserve the integrity of the relationship between these two parties. The Contracting Officer reviews the action to determine whether it is consistent with the existing contract and to ensure that the equities of the existing relationship are preserved and will be continued when a modification is issued and negotiated.
Generally, there must be
"consideration" whenever a contract is modified. Consideration is the
benefit each party confers upon the other for the modification; it is required
to seal a new bargain. Consideration is something of value that is given in
exchange for something else and thus can take many forms, including monetary.
Other forms can involve changes in specifications or work statements, delivery,
payment, or other contract terms and conditions.
It’s important that the
Contracting Officer not let a blind pursuit of a monetary consideration lead
him/her away from a good business deal. Consider the cost, schedule, and
performance impacts of jettisoning a current arrangement for another.
If a Contractor is entitled to a
time extension pursuant to a contract clause, no new consideration is required.
(An "equitable adjustment" is not consideration.) However, if the
parties negotiate a time extension at the request of either, and if the
requesting party is not entitled to the extension pursuant to a contract
clause, then the parties are modifying the contract by making a new deal and
therefore must exchange new consideration.
Public Law 85-804 allows for
modification of a contract without consideration under limited circumstances as
a form of extraordinary contractual relief. See FAR 50.103-1 and FAR 43.102(c), the latter of which expressly authorizes
certain modifications to be made without consideration.
A Contracting Officer cannot agree
to modify a contract without consideration if consideration is required. He or
she cannot "give" the Contractor a time extension. Such an action
would be beyond his or her authority under FAR and would not be binding on the
Government. However, it is up to the Contracting Officer to determine what
would be adequate consideration. Consideration need not compensate the
Government for what it gives to the Contractor. It need only be enough to seal
the deal in the eyes of a board or court. Ordinarily, courts and boards
consider anything of value to be adequate consideration, if the parties think
it's enough; chances are so will the boards and courts.
The case law in Administration of
Government Contracts, 3d ed., by Cibinic and Nash states that the requirement
for the Government to receive consideration has sometimes been stated as a
legal rule that no Government official may give away or remit a vested right of
the Government, Simpson v. United States, 172 U.S. 372 (1899). Thus, contract
modifications will typically be overturned if the Government obtains no benefit
whatsoever, H.Z. & Co., ASBCA 29572, 85-2 BCA ¶ 17,979; A.O. Smith Corp.,
ASBCA 16788, 72-2 BCA ¶ 9688. For a recent decision that discusses the requirement
for consideration for a modification in a Government contract case, see Garner,
Kamya & Associates, P.C. v. Jackson, 369 F.3d 1318 (Fed. Cir. 2004).
5.7 Options
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Contract prices as well as terms and conditions are negotiated and agreed upon at the time of (bilateral) award, and the Option Clause in the contract gives the Government the unilateral right to purchase additional products/services or extend the term of the contract at pre-agreed prices and/or terms. Options may be appropriate where the market is relatively stable, price inflation is fairly predictable, and the nature of the contract is not likely to change significantly between award and the time the Option is exercised, or where it may be difficult to test the market at a future date. For details as to when Options are appropriate, see APG Solicitation Module Section 2.3.5 Options. For evaluating Options prior to contract award..
Priced Options are unilaterally exercised by the Government prior to the start date of the optional period of performance. Effective contract management throughout the current period of performance should enable the Contracting Officer to make a prudent business decision concerning the exercise of the Option. The Contracting Officer should consider availability of funds, contract price and contract performance (timeliness and quality), among other factors, in arriving at this decision. The Contracting Officer should acquire input from the Project Officer, namely the Contracting Officer’s Representative (COR), to make a proper determination as to whether the Option should be exercised (See 120-Day Request Sample and Attachment 1 Project Office Response).
The Contracting Officer should notify the Contractor of the Government’s intent to exercise the Option with sufficient time for the Contractor to make decisions regarding resources, typically 60 days prior to the Option performance start date or the lead time otherwise stated in the contract. (see 60-Day Notification Sample) The Contracting Officer makes this notice in good faith; however, the Government is not bound to exercise the Option, should circumstances warrant, even after the notification has been given of its intent to do so.
Before an Option
can be exercised, the Contracting Officer shall make a written determination
that exercise of the Option is the most advantageous method of fulfilling its
needs, price and other factors considered per FAR17.207(c)(3). (See Sample D&F: Model Determination to Exercise the Contract Option
in Accordance with FAR 17.207.) With regard to the
consideration of “other factors,” the Contracting Officer should take into
account the need for continuity of operations and potential costs of disrupting
operations. To ensure the exercise of any option to a contract or order is carefully analyzed prior to execution, Procurement Memorandum (PM) 2011-02 (Revised), directs Contracting Officers to specify sufficient lead time in FAR clauses, as appropriate, to conduct aggressive market analysis in order to determine whether exercise of the option or an alternative approach to acquiring the goods or services is more advantageous to the Government. The conduct of the analysis should allow sufficient lead time for a new solicitation and award of a new contract or order if it is determined that exercising the option is not most advantageous to the Government. This PM also directs Contracting Officers to accept a voluntary price reduction through bilateral agreement with the contractor as an alternative to exercising an option when market conditions support it. The Contracting Officer’s written determination shall be based on
one of the following findings: (1) a new Solicitation fails to produce a better
price or a more advantageous offer; (2) an informal market survey or price
analysis indicates that the Option price is lower or the more advantageous
offer; or (3) the time between contract award and Option exercise is short
enough and the market stable enough that the Option price is the lowest price
obtainable or the more advantageous offer.
To satisfy
requirements of FAR
6 regarding full and open competition, the Option must have been evaluated
as part of the initial competition and be exercisable at an amount specified in
or reasonably determinable from the terms of the basic contract: specific
dollar amount, an amount determined by applying provisions (such as a specific
price subject to an economic price adjustment) or formula (such as in a cost
contract with fixed or maximum fee amount), or a specific price that is subject
to change as the result of changes to prevailing labor rates provided by the
Secretary of Labor.
For service contracts
exceeding the micro-purchase threshold, the McNamara-O'Hara
Service Contract Act (SCA)
requires that the Contracting Officer incorporate the most current SCA Wage
Determinations (WD) into an existing contract via modification to exercise an
Option or extend the contract. For those
service contracts which include a Collective Bargaining Agreement (CBA), the
Contracting Officer shall provide notice to both the incumbent Contractor and
its employees’ bargaining agent 30 days in advance of exercise of any Option.
See Sample CBA Notification Letter. For more information, see FAR 22.1010 as well as the Department of Labor (DOL)
Website: http://dol.gov/compliance/laws/comp-sca.htm.
Also visit http://www.wdol.gov/, which
provides a single location and electronic means for Contracting Officers to use
in obtaining appropriate SCA WDs for each official contract action, including
exercising Options. It may also be of
great benefit to review the Department of the Navy’s Desk Guide for Service Contract Price Adjustments for detailed discussion on the process that
Contracting Officers should take when processing contract price adjustments
that result from changes in wage determinations issued under the SCA or from
changing the minimum wage required by the Fair Labor Standards Act.
The Contracting Officer is afforded broad discretion in making the
determination to exercise an Option, and GAO has not historically questioned
the Contracting Officer’s decision to exercise an Option, rather than conduct a
new procurement, unless it is shown to be unreasonable or contrary to
applicable regulations. Reference GAO Case File B-296317, Antmarin Inc.;
Georgios P. Tzanakos; Domar S.r.l., July 26, 2005. Regarding a protest that the Department of the Navy improperly exercised the sixth
Option of a requirements-type contract for husbanding services is denied where
the Contracting Officer reasonably determined that exercising the Option was
the most advantageous means of satisfying the agency’s needs.
See the attached Exercise of Option Checklist.
5.7.1 SBA Size Recertification Top of Page |
See APG Planning Module Section 1.7.1.2.1
Recertification must occur prior to the following events:
5.7.2 Small business Size Re-Representation – Long-Term Contracts Top of Page |
See APG Planning Module Section 1.7.1.2.1
5.8 Stop-Work Order
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Situations may occur during contract performance that causes the Government to order a suspension of work or a work stoppage. In accordance with FAR 42.13, a stop-work order may be used in any negotiated fixed-price or cost-reimbursement supply, research and development, or service contract if work stoppage may be required for reasons such as advancement in the state-of-the-art, production or engineering breakthrough, or realignment of programs. Another example of when a stop-work order would be issued would be in response to a protest filed by an unsuccessful Offeror.
Generally, a stop-work order will be issued only if it is advisable to suspend work pending a decision by the Government and a supplemental agreement providing for the suspension is not feasible. Stop-work orders shall not be used in place of a termination notice after a decision to terminate has been made. Issuance and cancellation of a stop-work order must be approved at a level above the Contracting Officer.
FAR 42.1303 discusses what to include in a stop-work
order and what to do as soon as feasible after its issuance. Contracting
Officers may request assistance from the Project Officer in preparing the
following information for inclusion in a stop-work order:
· Description of the work to be suspended.
· Instructions concerning the Contractor’s issuance of further orders for materials or services.
· Guidance to the Contractor on action to be taken on any subcontracts.
· Suggestions to the Contractor for minimizing costs.
When required, a stop-work order should be issued immediately. Orders may take the form of either a letter or modification. Contracting Officers may issue stop-work orders for a period of 90 days or less. Order extensions beyond 90 days must be agreed to by the Contractor. (See FAR 52.242-15.)
After
issuing the stop-work order, the Contracting Officer should discuss the order
with the Contractor and modify the order, if necessary, in light of the
discussion. The Contracting Officer must then decide whether to terminate the
contract, cancel the stop-work order, or extend the period of the stop-work
order. If a stop-work order is
canceled or the period of the order or any extension thereof expires, the
Contractor shall resume work. The Contracting Officer shall make an equitable
adjustment in the delivery schedule or contract price, or both, and the
contract shall be modified, in writing, accordingly.
If a stop-work
order is not canceled and the work covered by the order is terminated for the
convenience of the Government, the Contracting Officer shall allow reasonable
costs resulting from the stop-work order in arriving at the termination
settlement. If a stop-work order is not canceled and the
work covered by the order is terminated for default, the Contracting Officer
shall allow, by equitable adjustment or otherwise, reasonable costs resulting
from the stop-work order. See “Sample Stop Work Order Modifications (SF 30) Language” for sample Stop Work Order, Stop Work
Order Cancellation and Stop Work Order Extension Modifications language.
5.9 Change Orders
|
A change order is a unilateral, written order signed by the Contracting Officer. Most equitable adjustments are the result of the contract Changes Clause. In accordance with the clause, the Contractor is entitled to a price adjustment if: a) the Contracting Officer changes any aspect of the general scope of the contract, and b) the change affects the cost of performing the work.
A Changes Clause serves four basic purposes:
The Changes Clause does not incorporate every change to the contract. Changes are limited to those that are within the general scope of the contract and the types of changes described by the clause. A change falls under the general scope of the contract if total work performed is essentially the same work or end product as called for in the original contract.
Note: For commercial item procurements, changes in the terms and conditions of the contract may be made only with written agreement of both parties.
Note: Change orders, as a result of the Changes Clause, are not applicable to commercial procurements. For commercial item procurements, changes in the terms and conditions of the contract may be made only with written agreement of both parties.
5.9.1 Documentation of Contract Modifications – Change Order Top of Page |
5.9.2 Change Orders as Modifications to Purchase Orders (PO)s Top of Page |
Although seldom used to modify
POs, a change order can be issued under the following conditions:
· A change order can only be made to a bilateral PO in which the applicable Changes Clause has been incorporated into the original PO or has been incorporated via bilateral modification.
· The proposed change must be within the scope of the original order and allowable under the changes clause as follows:
· For supplies, drawings, designs or Specifications where supplies to be furnished are to be specially manufactured for the Government per those drawings, designs, or Specifications; method of shipment or packing; or place of delivery;
· For services, description of services to be performed; time of performance or place of performance of the services; or
· For services where supplies are to be furnished items in the two bullets above.
5.10
Clams and Request for Equitable Adjustment
|
Any change in requirements made by the Contracting Officer to a contract via the Changes clause can result in the Contractor submitting to the Government a Request for Equitable Adjustment (REA) and/or Claim for an equitable adjustment in the contract price, the delivery schedule, or both. For example, the Government could issue a unilateral change order in accordance with the applicable Changes clause, or the Contractor could initiate a Claim based on Government-caused work delays or other issues leading to increased costs (e.g., excessive inspection; items repaired/services performed under warranty that were later deemed to be the Government’s fault; or late delivery of Government Furnished Property (GFP) which delayed work).
See the DAU CON 112 Lesson for Contract Claims and DAU Material on Contract Modifications and Adjustments.
5.10.1 Claims Versus Request for Equitable Adjustment (REA) Top of Page |
Although the purpose of a Claim is identical to that of an REA (i.e., to grant the Contractor an equitable adjustment for work done that was outside scope of the contract), some differences remain between the two requests:
|
CLAIM |
REA |
Required Certification |
When exceeding $100,000 per FAR 52.233-1. |
When exceeding $100,000 per FAR 52.233-1. |
Timely Decision |
Upon receipt of a properly certified Claim in excess of $100,000, the Contracting Officer must either issue a final decision or notify the Contractor when a final decision will be issued within 60 calendar days of the request. |
No deadline exists for responding to an REA but the Government should respond as promptly as possible. |
Final Decision and
Appeal |
Final decisions issued by a Contracting Officer in response to a properly certified Claim (or a Contracting Officer’s failure to issue a final decision within the time limits identified above) may be appealed to the General Services Board of Contract Appeals (GSBCA) or COFC. |
The GSBCA do not have jurisdiction over REAs that do not satisfy the definition of a “Claim.” |
Interest |
Interest must be paid on Claims from the date of their submission. |
Interest is not paid on REAs. |
To determine if the dollar threshold of $100,000 for requiring certification is met, add together the absolute value of each cost increase and each cost decrease. For example:
An REA that involves both an increase of $50,000 and a decrease of $55,000 has an absolute value of $105,000 ($50,000 + $55,000, regardless of whether the amounts are plus or minus), which exceeds the Simplified Acquisition Threshold (SAT).
Note that before either a Claim or an REA can be settled, the Contractor must provide certified cost and pricing data to the Government if the requested price adjustment will exceed $650,000.
5.10.2 Requirements for a Claim Top of Page |
If the Contractor has certified an REA and desires to convert the request to a Claim under the Contract Disputes Act, the Contractor must certify the Claim in accordance with FAR 33.2 Disputes and Appeals. The Contractor also must meet the following criteria as specified under FAR Clause 52.233-1:
Unless otherwise stated in the contract, all Claims made by
a Contractor must be submitted in writing to the Contracting Officer within six
years after accrual of the Claim.
5.10.3 Procedure for Handling a Request for Equitable Adjustment or Claim Top of Page |
Once an REA or Claim is received by the Contracting Officer,
the Contracting Officer should establish a team to handle that Claim. The
members of the team should include the Contracting Officer, representatives of
the Project Officer and any other relevant personnel from other Government
organizations (e.g., DCAA, DCMA).
After the team members are identified, the team should initiate the following procedures:
5.10.4 Release of Claims Top of Page |
For any equitable adjustment resulting from a Change Order (FAR 43.2), include in the supplemental agreement modification, a Release of Claims similar to that cited at FAR 43.204(c) (2).
5.10.5 Alternative Dispute Resolution Top of Page |
Although the use of Alternative Dispute Resolution (ADR) techniques may be employed at any time, certain factors may make the use of ADR inappropriate in a particular situation. ADR techniques include, for example, assisted settlement negotiations, conciliation, facilitation, mediation, fact-finding, mini-trials, and arbitration. For further details, contact Counsel.
For more information on Claims and REAs, please reference FAR 33.2, FAR 43 and FAR 52.243-1 through 52.243-7.
5.10.6 Contracting Officer’s Final Decision Top of Page |
In accordance with NOAA’s Acquisition Handbook, proposed Claim settlements and final decisions of the Contracting Officer shall be reviewed for legal sufficiency and format before sending the final decision to the contractor. In accordance with Procurement Memorandum (PM) 2011-05. The Senior Bureau Procurement Official (SBPO) shall submit all final decisions, claims and settlements to the Senior Procurement Executive (SPE) for review and approval prior to execution and/or issuance for review.
Equitable
Adjustments Not Specifically Covered by Contract Clauses
o Disagreement over contract requirements.
o Failure of the Government to cooperate during contract performance.
o Defective Specifications and misleading information.
o Acceleration of contract performance to finish sooner than what is stated in the contract schedule.
For any equitable adjustment resulting from a Change Order (FAR 43.2), include in the supplemental agreement modification, a Release of Claims similar to that cited at FAR 43.204 (c)(2).
For resolution of Claims
involving acquisition fraud, Contracting Officers may not “settle,
compromise, pay, or otherwise adjust” any Claim involving fraud. Submit any suspected contractor’s
fraudulent claim(s) to the Office of the Inspector General for investigation.
For more information on Claims and REAs, see the DAU CON 112 Lesson for Contract Claims and DAU Material on Contract Modifications and Adjustments.
5.11 Terminations
|
The Government reserves the
right to terminate any contract. Common grounds for termination include
reduction or reallocation of Congressional/program funding, determination that
a contract is unnecessary, or unacceptable Contractor performance. The Project
Officer may identify grounds for termination, but only the Contracting Officer
has the authority to actually terminate a contract. The Contracting Officer
should consult with Counsel prior to terminating any contract action whether in
whole or in part.
There are three types
of Government contract terminations:
5.11.1 Termination for Default Top of Page |
The Government may
terminate a Contractor for default in whole or in part when the Contractor
fails to deliver or perform, fails to make progress, fails to meet other
contract provisions, abandons the contract, or repudiates the contract in an
anticipatory manner. A Termination for Default (T4D) is an extreme sanction and
should not be taken lightly – not only does it mar a Contractor’s reputation,
limiting its chances in future competition and Government support; a T4D ends
performance on the contract, potentially delaying satisfaction of the
Government’s requirement. In addition, the Contractor may be forced not only to
repay the Government for charges already billed, but also for the difference
between the contract price and the price the Government had to pay for a
replacement Contractor to deliver the supplies or perform the services not
delivered/performed by the defaulting Contractor.
If the Contracting
Officer determines that the Contractor has failed to deliver supplies/services
in accordance with the contract delivery schedule, or that the Contractor has
abandoned or anticipatorily repudiated the contract, the Government is not
required to give the Contractor an opportunity to explain its conduct. It is
nevertheless advisable for the Contracting Officer to issue the Contractor a
Show Cause Notice under such circumstances so that the Contractor has an
opportunity to explain if and why its failure to deliver arose from causes
beyond its control and without failure or negligence on its part, and so that
response can be considered by the Contracting Officer prior to terminating the
contract for default.
If the Contracting
Officer determines that the Contractor has failed to make progress or has
failed to perform a material contract provision, the Contracting Officer must
issue a Cure Notice to the Contractor and provide the Contractor 10 calendar
days (or a longer period if necessary) in which to cure the failure. If,
however, the time remaining in the contract delivery schedule is insufficient
to permit a realistic “cure” period of 10 calendar days or more, the
Contracting Officer can issue a Show Cause Notice.
The issuance of
either a Cure Notice or a Show Cause Notice are the first steps along a path
that may end in a T4D and should only be issued when the Project Officer will
support that ultimate action. They should not be issued as scare tactics when
the Project Officer has no intention of following through if the Contractor
will not or cannot comply with the requirements set forth in the letter – this
is tantamount to crying “wolf” and ultimately undermines the credibility of the
NOAA.
Although the Contracting Officer has the right under the “Default” clause to terminate the contract, the Contracting Officer does not have to exercise that right. The Contracting Officer must weigh all relevant factors in determining whether to T4D a contract, such as:
·
The terms
of the contract and applicable laws and regulations.
·
The
specific failure of the Contractor and the excuses for the failure.
·
The
availability of the supplies/services from other sources.
·
The
urgency of the need for the supplies/services and the period of time required
to obtain them from other sources (as compared with the time they could be
obtained from the delinquent Contractor).
·
The
degree of essentiality of the Contractor in the program and the effect of a T4D
upon the Contractor’s capability as a supplier.
·
The
effect of a T4D on the ability of the Contractor to liquidate guaranteed loans,
progress payments, or advance payments.
·
Other
pertinent facts and circumstances.
If, upon reviewing these factors, the Contracting Officer decides to T4D the contract, the Contracting Officer will draft a memorandum that memorializes his/her decision and then issue a termination notice to the Contractor. For more specific guidance on contract T4D, see FAR 49.4 and FAR 52.249-6 through 52.249-10.
5.11.2 Termination for Convenience Top of Page |
A contract can also be terminated (in whole or in part) for convenience as long as the Contracting Officer determines that termination is in the Government’s interest and that the termination is not made in bad faith or reflects an abuse of Contracting Officer discretion. Before undertaking a Termination for Convenience (T4C), however, the agency should endeavor to enter into a no-cost cancellation with the Contractor.
Examples for which a
contract would be terminated for convenience include situations in which the
technology to be procured has become obsolete, new technological developments
have occurred subsequent to contract award, the Government’s requirements have
changed, or a reduction or reallocation of Congressional/program funding has
occurred.
After a contract has
been terminated for convenience, the Contractor is entitled to be reimbursed
for all allocable, allowable, and reasonable costs it incurred as of the
termination date, reasonable profit on work done (unless the Contractor would
have sustained a loss on the entire contract had it been completed),
termination settlement expenses, and certain continuing costs
(post-termination). A Contractor must follow all procedures listed in the T4C
clause contained in its contract or risk losing its right to be reimbursed for
such costs and profit.
Once it is decided that a contract will be terminated for convenience,
the Contracting Officer should issue a detailed, written notice of termination
to the Contractor. Upon receipt of that notice, the Contractor must, amongst
other things, stop work and promptly submit a termination settlement proposal
to the Terminating Contracting Officer (TCO).
For more specific guidance on T4Cs, please reference T4C FAR 52.249-1 through 52.249-6 and FAR 49.
5.11.3 Termination of Commercial Contracts Top of Page |
A Contracting
Officer should exercise the Government’s right to terminate a contract for
commercial items only when such a termination would be in the best interest of
the Government. The Contracting Officer may terminate a commercial item
contract for Cause or for Convenience.
FAR 52.212-4 permits the Government to terminate a contract
for commercial items either for the convenience of the Government or for cause.
However, the paragraphs contained therein contain concepts that differ from
those contained in the termination clause.
The requirements of FAR 49 do not apply when terminating contracts for
commercial items and Contracting Officers shall instead follow the procedures
in FAR 12.403. Contracting Officers may use this FAR Part as
guidance to the extent that it does not conflict with FAR 12.403 and the language of the termination paragraphs
in clause FAR 52.212-4.
5.11.3.1 Commercial Termination for Cause Top of Page |
When a
Termination for Cause is appropriate, the Contracting Officer shall send the
Contractor a written notification regarding the termination. At a minimum, this
notification shall indicate the following:
The Contracting
Officer should consult with Counsel prior to terminating for cause.
FAR 52.212-4 paragraph “Excusable Delay” requires
Contractors to notify the Contracting Officer as soon as possible after
commencement of any excusable delay. In most situations, this requirement
should eliminate the need for a show cause notice prior to terminating a
contract. If a contract will be terminated for a reason other than late
delivery, the Contracting Officer shall send a Cure Notice prior to terminating
the contract.
The Government’s
rights after a Termination for Cause shall include all the remedies available
to any buyer in the marketplace. The Government’s preferred remedy will be to
acquire similar items from another Contractor and to charge the defaulted
Contractor with any excess reprocurement costs together with any incidental or
consequential damages incurred because of the termination. In
the event of a Termination for Cause, the Government shall not be liable to the
Contractor for any amount for supplies/services not accepted, and the
Contractor shall not be liable to the Government for any and all rights and
remedies provided by law.
In the case of individual orders for supplies or services
placed against Federal Supply Schedule (FSS) contracts or BPAs established
against FSS contracts, if a
Contractor fails to perform an order or take appropriate corrective action, the
Contracting Officer may terminate the order for cause or modify the order to
establish a new delivery date (after obtaining consideration, as appropriate).
The Schedule Contracting Office shall be notified of all instances where an
ordering activity Contracting Officer has terminated for cause an individual
order to an FSS Contractor.
5.11.3.2 Commercial Termination for the Government’s Convenience Top of Page |
When the
Contracting Officer terminates a contract for commercial items for the Government’s
convenience, the Contractor shall immediately stop all work and shall direct
any and all of its suppliers and subcontractors to do the same.
The Contractor shall be paid the following:
Generally, the parties should mutually agree upon
the requirements of the termination proposal. The parties must balance the
Government’s need to obtain sufficient documentation to support payment to the
Contractor against the goal of having a simple and expeditious settlement.
Under FSS contracts, a Contracting Officer may terminate
individual orders for the Government’s convenience, in compliance with FAR 12.403. Before terminating orders
for the Government’s convenience, the Contracting Officer shall endeavor to
enter into a no-cost settlement agreement with the Contractor. Only the Schedule Contracting Officer may modify the
Schedule contract to terminate any, or all, supplies or services covered by the
Schedule contract for the Government’s convenience.
5.12 Ratification of Unauthorized Commitments
|
FAR
1.6 provides that only a Contracting
Officer has the authority to enter into contracts or otherwise bind the
government to a contractual commitment. It
is the policy of the Department of Commerce that all acquisitions are to be
made only by government officials having authority to make such commitments.
Contracting Officers may bind the Government only to the extent of the
authority delegated to them.
All personnel are responsible for ensuring that their
dealings with Contractors are conducted in such a manner as to avoid the
impression that they intend to obligate the Government in any manner
whatsoever. Specifically, regarding existing or prospective contractual
matters, no person except a Contracting Officer may take any action concerning:
An Unauthorized Commitment (UC) is an
agreement that is not binding solely because the Government representative who
made it lacked the authority to enter into that agreement on behalf of the
Government (FAR 1.602). The ordering and acceptance of supplies and
services without benefit of a legal contract constitute improper acts and do
not obligate the Government for the items ordered, but may incur a personal
liability to the individual who made the commitment. However, such agreements
can be ratified, or approved, after they have been illegally authorized, but
only by an official who has the authority to do so and only when the following
conditions are met:
·
The Ratifying Official
has the authority to enter into a contractual commitment;
·
The resulting contract
would otherwise have been proper if made by an appropriate Contracting Officer;
· The Contracting Officer reviewing the UC determines the price to be fair and reasonable;
· The Contracting Officer recommends payment and Counsel concurs in the recommendation, and
· Funds are available and were available at the time the UC was made. The obligation is chargeable to the fiscal year in which the need arose and the work was performed as a result of the UC. Funding must be from the fiscal year in which the UC took place if such funds are available. Otherwise, currently available funds may be utilized.
· The ratification is in accordance with Department of Commerce policies and procedures.
The
Department’s goal is to minimize these actions.
This policy implements preventive measures and prescribes the
ratification process, including the multi-level review for all ratifications of
unauthorized procurement actions, ratification release and contract language
for payments. In addition, it provides
information regarding measures that may be taken to minimize or prevent the occurrence
of unauthorized commitments. See CAM
1301.602.
For
NOAA, the Authorized Ratifying Official as stated in the Department of Commerce
Acquisition Letter (AL) 30 is the Head of the Contracting Activity (HCA);
however, the HCA has delegated this to the Senior Bureau Procurement
Official. In accordance with Procurement Memorandum (PM) 2011-05, for ratifications of unauthorized commitments in excess of $50,000. the SBPO shall submit these actions to the Senior Procurement Executive (SPE) for review and approval prior to issuance or execution.
Each NOAA Acquisition Office will maintain a log of
all ratification actions which will show the originator of the ratification
action, the originator’s organization, a description of what was acquired, the
date, the amount, and current status. A copy of the log shall be provided to
the Director, AGO, no later than the 15th of the month on a quarterly basis in
January, April, July, and October. Notice of instances of repetitive
ratification actions by an individual or within an organizational component,
will be provided to the Associate Administrator (AA), and/or Deputy Associate
Administrator (DAA) of NOAA Line Offices (LOs) or Staff Office (SO) Directors.
Cases
that are not ratifiable under the FAR 1.602-3 procedures may be subject to resolution as
recommended by the Government Accountability Office (GAO) under its claim
procedure or as authorized by FAR
50. These cases require Counsel review. UCs that involve claims
subject to resolution under the Contract Disputes Act should be processed in
accordance with FAR 33.2, Disputes and Appeals. See APG 5.10 for details.
The Project Officer must ensure that proactive measures are in place within their department to prevent the occurrence of UCs. If, however, a UC occurs, individuals who made the UC will be asked to forward a signed statement identifying the circumstances, accompanied by all available orders, invoices, or other documented evidence of the transaction, to the Responsible Program Official via their chain of command. This includes, at a minimum:
· A statement regarding the nature of the unauthorized procurement action and the individuals involved, including all managers who knew of the action and allowed it to take place;
· A discussion of the program requirements and an explanation of how the unauthorized procurement action occurred, and why it was considered valid and necessary to meet program requirements;
· Explain whether or not competition was sought. Provide an explanation of the initial selection of the proposed contractor, (i.e., market research or sole source justification) include names, addresses, phone numbers, and provide quotes received from any other sources that were considered;
· A statement of any approvals or clearances received for the unauthorized procurement action, including a listing of who told the contractor to proceed and on what date the contractor was so notified;
· A description of the work performed or products furnished, date inspected and accepted, including the date work started for services;
· The estimated or agreed to purchase price and the estimated or agreed to completion date and the date when they were agreed to (include how price or cost reasonableness was evaluated and who agreed to it);
· A copy of the most current invoice;
· A description of what has been done to prevent recurrence, including any disciplinary action taken against parties involved;
· A description of any attempts made to involve properly authorized procurement personnel before any commitment was made to the contractor (include any factors which prevented such involvement); and
· Provide a statement addressing whether or not funds were available at the time of commitment and whether or not they are still available to date.
· Any other pertinent information regarding the unauthorized procurement action or the ratification request.
If the Responsible Program Official concurs that the commitment should be ratified, the Responsible Program Official will forward a signed memorandum that thoroughly addresses and includes each of the above eleven elements to the HCO through the Contracting Officer with an endorsement that verifies the accuracy and completeness of the documentation, describes measures taken to prevent a recurrence of the UC, and provides a complete purchase description and appropriate funding document (CD 435) for the ratifying contract.
The Contracting Officer will review
the Responsible Program Official Memorandum and endorsement provided, ascertain
whether there are any doubtful questions of fact, prepare a Memorandum (See Sample Memorandum to HCO Recommending Approval of Ratification
Action) that addresses provisions contained in FAR 1.602-3(c), to the Ratifying Official/HCO with contractual
documents citing availability of funds, and submit the contract and supporting
documents to DOC OGC CLD for an
opinion as to form and legality and for any additional pertinent comment or
advice.
DOC OGC CLD will review the Memorandum and other documentation for legal sufficiency and comment on the payment recommendation. OGC shall provide documentation of legal sufficiency for the contract file.
The Ratifying Official/HCO will review the ratification file, and either ratify the UC (and execute or authorize execution of a contractual document) or deny the ratification request.
See Unauthorized Commitment Correspondence Toolbox, Ratification Checklist, UC and Ratification Process Guide for the Project Officer.
5.13 Contract File Maintenance, Closeout, and File
Retention
|
Documentation in the contract files (see FAR 4.803) shall be sufficient to constitute a complete history of the transaction for the purpose of: (1) providing a complete background as a basis for informed decisions at each step in the acquisition process; (2) supporting actions taken; (3) providing information for reviews and investigations; and (4) furnishing essential facts in the event of litigation or Congressional inquiries.
The contract file must contain a complete and accurate record of the chronology of the purchase action. Once the contract is physically complete, deliveries and/or services have been completed by the Contractor and accepted by the Government (see FAR 4.804-4), the Administrative Contracting Officer (ACO) must then close the contracts with assistance from the Project Officer/designated Contracting Officer’s Representative (COR).
Examples of the files that must be closed out include (see FAR 4.803):
Once all receivables have been delivered/completed and verified by the Project Officer/COR, the ACO or Contracting Officer reviews the contracts files for remaining closeout actions. The time standards for closing out contract files when the closeout is by the office administering the contract are as follows (see FAR 4.804-1):
For time standards for closing out contract files when the closeout is by an office other than the office that administered the contract, see FAR 4.804-2.
Additionally,
to the maximum extent possible and where appropriate for all contracts, use the
Quick Closeout procedures (FAR 42.708).
A
straw-man checklist of actions to accomplish when closing a contract are
consolidated in a Contract Closeout Checklist.
Upon completion of these responsibilities, the Administrative Contracting Officer shall complete the Contract Completion Statement. The [Administrative] Contracting Officer signs the final certification that the contract is closed.
For more information on
Contract Completion and Contract Closeout, please see CAM Part 4 Chapter 3, “Contract Closeout Procedures”. See also Contract Closeout Flowchart, which depicts an overview of
the closeout process. DCMA’s Contract Closeout Guidebook is also a useful
resource.
5.13.1 Contract File Retention Period Top of Page |
Scenario |
Retention Period |
Records
pertaining to Contract Disputes Act actions |
6 years and 3
months after final action or decision |
Contracts (and
related records or documents, including successful proposals) exceeding the
simplified acquisition threshold for other than construction |
6 years and 3
months after final payment |
Contracts (and
related records or documents, including successful proposals) at or below the
simplified acquisition threshold for other than construction |
3 years after final payment |
*Construction
contracts $2,000 or less |
3 years after
final payment |
*Construction
contracts above $2,000 |
6 years and 3
months after final payment |
[Documents]
relating to contracts at or below the Simplified Acquisition Threshold (SAT) |
1 year after date
of award or until final payment, whichever is later. |
Files for
canceled Solicitations |
5 years after
cancellation. |
Other copies of
procurement file records used by component elements of a contracting office
for administrative purposes |
Upon termination
or completion. |
Data submitted to
the Federal Procurement Data System (FPDS)/[PMRS]. Electronic data file
maintained by fiscal year, containing unclassified records of all
procurements other than simplified acquisitions, and information required
under FAR 4.601. |
5 years after
submittal to FPDS |
Investigations,
cases pending or in litigation (including protests), or similar matters |
Until final
clearance or settlement, or, if related to a document identified in
(b)(1)-(9), for the retention period specified for the related document,
whichever is later |
Generally, files for simplified acquisitions (other than construction) must be retained for three (3) years after final payment. Contracts exceeding the SAT (other than construction) must be retained for six (6) years and three (3) months after final payment. Documents relating to contracts at or below the SAT must be retained for one (1) year after date of award or until final payment, whichever is later. There are other specific retention periods for actions such as protests and claims. Consult FAR 4.805 and APG 5.13.1 for contract file retention periods.
5.13.2 Maintenance Top of Page |
Proper documentation of the various business decisions involved in the procurement process is crucial. Regardless of the simplified acquisition method used, a file documenting all actions taken should be maintained for each purchase action. The contract file should contain anything that helps provide a complete history of the transaction. FAR 4.803 provides a comprehensive list of items generally maintained in a contract file. The following are few of the most important documents to be included in the contract file for acquisitions at or below the SAT:
In addition to the above listed items, for acquisition of commercial items under FAR 13.5, several other items should be included in the contract file including, but not limited to, the following:
5.13.3 File Documentation for GSA FSS Orders Top of Page |
For orders at or below the
micro-purchase threshold, documentation, at a minimum, should consist of the
Contractor’s name and address, contract number, the item purchased, the amount
paid and Contractor delivery and payment terms. Orders over the micro-purchase
threshold, as a minimum, should contain the same information for each Contractor
reviewed. Additional supporting file documentation should be provided if the
Contracting Officer selects a Schedule Contractor on a basis of other than
price. The Contracting Officer should document the file with the basis by which
he/she determined the proposed DO offers the best value to the Government,
price and other factors considered.
5.13.4 Close-Out Top of Page |
The Contracting Officer shall close out simplified acquisitions upon evidence of receipt, acceptance, and final payment. The Contracting Officer may use one of two methods to close out contract files:
· Consider the file closed when he/she receives evidence of receipt of property and final payment.
· Consider the file closed 180 days after the scheduled delivery date unless there is indication that final delivery and final payment have not occurred by that date.
Contract completion documentation should be limited to a statement in the file that it is closed out per one of the two methods listed above. Contracting Offers remain responsible for ensuring that Contractors are paid in a timely manner and the Customer receives the goods and/or services purchased.
A straw-man checklist of actions to accomplish when closing a contract are consolidated and provided in the following table.
Contract Close-out Checklist (rev. 2/8/2011) |
|
Contract # |
|
Project # |
|
Contractor |
|
Applicability (yes-no-n/a) |
CHECKLIST ITEMS |
|
1. Disposition of classified material is completed. |
|
2. Final patent report is cleared. |
|
3. Final royalty report is cleared. |
|
4. There are no outstanding VECPs (Value Engineering Change Proposals). |
|
5. Plant clearance report is received. |
|
6. Property clearance is received. |
|
7. All interim or disallowed costs are settled. |
|
8. Price revision is completed. |
|
9. Subcontracts are settled by the prime contractor. |
|
10. Prior year indirect cost rates are settled. |
|
11. Termination docket is completed. |
|
12. Contract audit is completed. |
|
13. Contractor given an opportunity to submit a closing statement. |
|
14. Contractor's final invoice is submitted. |
|
15. All forms of Government-provided identification has been collected from the contractor. |
|
16. Contract funds review is completed and excess funds deobligated. |
|
17. Close-out FPDS-NG Report is inputted into system. |
|
18. Contractor Performance Evaluation Report completed if applicable. |
Certification: I certify that all required contract administration actions, as listed above, have been fully and satisfactorily completed. ________________________________________________ ____________________________ |
*The ACO/Contracting Officer is responsible for all other contractual actions including deobligating unliquidated obligations.
5.14
Summary of Post-Award Module References
|
Section |
Loc |
Reference Description |
Type |
Source |
1 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Website |
FBO |
||
4 |
Statute |
Federal |
||
5 |
Policy |
DOC |
||
6 |
Regulation |
FAR |
||
1
|
Sample |
NOAA |
||
2
|
Regulation |
FAR |
||
3
|
Regulation |
FAR |
||
1 |
Policy |
DOC |
||
2 |
Statute |
Federal |
||
3
|
Policy |
NOAA |
||
4 |
Post-Award Notices (NOAA
Acquisition Alert 10-01, Attachment 3),
|
Policy |
NOAA |
|
1 |
Regulation |
FAR |
||
2
|
Regulation
|
FAR
|
||
3
|
Acquisition Alert (AA) 11-01 | Policy |
NOAA |
|
4 |
Website |
FPDS |
||
5 |
Regulation |
FAR |
||
6
|
Website |
FSRS
|
||
7
|
Acquisition Alert (AA) 11-01 | Policy |
NOAA |
|
8
|
Regulation |
FAR |
||
1 |
Regulation |
DOC |
||
2 |
Website |
GAO
|
||
3 |
Website |
COFC |
||
4 |
DOC Office of
General Council, Contract Law Division (OGC CLD)
|
Website |
DOC |
|
5 |
Regulation |
FAR |
||
6
|
Policy
|
DOC |
||
7
|
Policy |
DOC
|
||
8
|
Policy |
DOC |
||
9
|
Policy |
NOAA |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
4 |
Regulation |
FAR |
||
5 |
Regulation |
FAR |
||
6 |
Regulation |
DOC |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Sample D&F To Continue Performance in the Face of a GAO
Protest.
|
Sample |
NOAA |
|
4 |
Internal |
APG |
||
1 |
Website |
COFC
|
||
2 |
Department of
Commerce, Office of General Counsel, Contract Law Division
|
Website |
DOC |
|
1 |
Regulation |
FAR |
||
1 |
Policy |
DOC |
||
2 |
Sample |
NOAA |
||
1 |
Sample |
NOAA |
||
2 |
Regulation |
FAR |
||
3 |
Sample |
NOAA |
||
4 |
Template |
NOAA |
||
5 |
Template |
NOAA |
||
6 |
Checklist |
NOAA |
||
1 |
Internal |
APG |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
4 |
Contractor
Past Performance Assessment Reporting System (CPARS)
|
Website |
CPARS
|
|
5 |
Website |
PPIRS
|
||
6 |
Regulation |
FAR |
||
7
|
Regulation
|
FAR
|
||
8
|
Regulation
|
FAR
|
||
9
|
Regulation
|
FAR
|
||
10
|
Website
|
CPARS |
||
11
|
Website |
PPIRS
|
||
12
|
Website
|
PPIRS
|
||
13
|
Policy |
DOC |
||
14
|
OFPP’s “Best Practices for Collecting and Using Current and
Past Performance Information”
|
Guidance |
Federal |
|
15
|
A Guide to Collection and Use of Past Performance Information (Version 3)
|
Guidance
|
Federal
|
|
16
|
Guidance |
Federal |
||
1 |
Regulation |
DOC |
||
2 |
Internal |
APG |
||
3 |
Regulation |
FAR |
||
4 |
Regulation |
FAR |
||
5 |
Website |
DOC |
||
6 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Guidance |
Federal |
||
3 |
Guidance |
Federal |
||
4 |
Internal |
APG |
||
5 |
Sample |
NOAA |
||
6 |
Regulation |
FAR |
||
7 |
Regulation |
FAR |
||
8 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Training |
Federal |
||
3 |
Training |
Federal |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
4 |
Regulation |
FAR |
||
5 |
Regulation |
FAR |
||
6 |
Regulation |
FAR |
||
7 |
Regulation |
FAR |
||
8 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3
|
Garner, Kamya & Associates, P.C. v. Jackson, 369 F.3d1318(Fed.Cir. 2004)
|
Regulation |
FAR |
|
1 |
Internal |
APG |
||
2 |
120-Day Request Sample and Attachment 1 Project Office
Response
|
Sample |
NOAA, AGO |
|
3 |
Sample |
NOAA |
||
4 |
Regulation |
FAR |
||
5 |
Sample D&F: Model Determination to Exercise the Contract
Option in Accordance with FAR 17.207
|
Sample |
NOAA |
|
6 |
Policy
|
DOC |
||
7
|
Regulation
|
FAR
|
||
8
|
Sample |
NOAA |
||
9 |
Regulation |
FAR |
||
10
|
Department of Labor (DOL)
Website: http://dol.gov/compliance/laws/comp-sca.htm.
|
Website |
DOL
|
|
11
|
Website |
DOL
|
||
12
|
Department of the Navy’s Desk Guide for Service Contract Price Adjustments
|
Guidance |
DON
|
|
13
|
GAO
Case File B-296317, Antmarin Inc.; Georgios P. Tzanakos; Domar S.r.l., July 26, 2005
|
Guidance |
GAO |
|
14
|
Checklist |
NOAA |
||
1 |
Internal |
APG |
||
1 |
Internal |
APG |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
4 |
Sample |
NOAA |
||
1 |
Sample |
NOAA |
||
2 |
Policy |
DOC |
||
1 |
Training |
Federal |
||
2 |
Training |
Federal |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Template |
NOAA |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
1
|
Procurement Memorandum (PM) 2011-05
|
Policy
|
DOC
|
|
2
|
Regulation |
FAR |
||
3
|
Regulation |
FAR |
||
4
|
Training |
Federal |
||
5
|
Training |
Federal |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
4 |
Regulation |
FAR |
||
5 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Policy |
DOC |
||
4 |
Policy |
NOAA |
||
5
|
Policy
|
DOC
|
||
6 |
Regulation |
FAR |
||
7
|
Regulation |
FAR |
||
8
|
Regulation |
FAR |
||
9
|
Internal |
APG |
||
10
|
Sample Memorandum to HCO Recommending Approval of
Ratification Action
|
Sample |
NOAA |
|
11
|
Regulation |
FAR |
||
12
|
Sample |
NOAA |
||
13
|
Checklist |
NOAA |
||
14
|
Guidance |
NOAA |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
4 |
CAM
1317.570 Appendix D for Close-Out Checklists
|
Policy |
DOC |
|
5 |
Regulation |
FAR |
||
6 |
Regulation |
FAR |
||
7 |
Regulation |
FAR |
||
8
|
Sample |
NOAA |
||
9
|
Policy |
DOC |
||
10
|
Guidance |
NOAA |
||
11 |
Guidance |
Federal |
||
1 |
Regulation |
FAR |
||
2 |
Regulation |
FAR |
||
3 |
Regulation |
FAR |
||
1 |
Regulation |
FAR |
||
2 |
Form |
GSA |
||
3 |
Form |
GSA
|
||
4 |
Regulation |
FAR |