Appendix 2
Contract Planning and Source Selection
This appendix provides an overview of contract planning (pre-award and solicitation) and of source selection (evaluation and award). Figure 16 depicts the overall contracting process.
Pre-award and Solicitation
The requiring unit has the responsibility to determine the need for supplies and services. This is the first and most critical step in the planning process. The follow-on steps focus on forecasting, planning, and defining the acquisition requirements; developing and updating acquisition plans and strategies, justifications, and authorizations; conducting market research; preparing program plans, cost estimates, and schedules; and determining priorities. Federal Acquisition Regulation (FAR) 7.102(a), Policies, requires that "agencies shall perform acquisition planning and conduct market research for all acquisitions." In addition to ensuring compliance with the FAR requirement, contract planning helps anticipate problems, save time in the future, save money, stay on schedule, communicate to higher management, and generate the commitment.
Market Research
Acquisitions of supplies and services begin with a description of the government's needs stated in terms sufficient to allow the acquisition team to conduct market research. The results of the market research form the basis for developing new requirement documents and issuing solicitations. Market research is an ongoing process used to collect, organize, maintain, analyze, and present data. Its purpose is to maximize the capabilities, technology, and competitive forces of the marketplace to meet an organization's needs for supplies and services. The COR may be asked to assist with gathering market research information for use by decision makers to determine the best approach for acquiring the needed supply or service.
![Figure 16. Acquisition Process, Part 1](https://webarchive.library.unt.edu/web/20130303222103im_/https://acc.dau.mil/GetRichTextImage.aspx?id=475202&imageid=1ae8ea0a-f4ce-4926-9200-d3d98676dbc2)
Figure 16. Acquisition Process, Part 1 (above)
![Figure 16. Acquisition Process, Part 2](https://webarchive.library.unt.edu/web/20130303222103im_/https://acc.dau.mil/GetRichTextImage.aspx?id=475202&imageid=6856b844-b99c-41e7-b318-2bffe1199a8b)
Figure 16. Acquisition Process, Part 2 (above)
The research will vary, depending on such factors as urgency, estimated dollar value, complexity, and past experience. This research involves obtaining information specific to the item being acquired and determining whether the government's needs can be met by items that are customarily available in the commercial marketplace, by items that are customarily available in the commercial marketplace but need modifying, or by items used exclusively for governmental purposes. Results should be documented in a manner appropriate to the size and complexity of the acquisition. Market research also helps the government develop independent government estimates (IGE) when conducting cost analysis.
Performance Work Statements
Performance work statements (PWS) describe the required results in clear, specific, and objective terms with measurable outcomes. Typically, a PWS covers the following topics.
- Introduction
- Background information
- Scope
- Applicable documents
- Performance requirements
- Special requirements or constraints (such as security)
- Deliverables
Best practices and lessons learned for developing a PWS include the following.
- The requirement should not be so specific that all offerors propose the same solution, eliminating creativity and innovation.
- A performance-based acquisition requires that the integrated solutions team jettison some traditional approaches to buying services. Specifically, specifying labor categories, educational requirements, or number of hours of support required should be avoided because they are how to approaches. Instead, let contractors propose the best people with the best skill sets to meet the need and fit the solution. The government can then evaluate the proposal based both on the quality of the solution and the experience of the proposed personnel.
- Prescribing manpower requirements limits the ability of offerors to propose their best solutions, and it could preclude the use of qualified contractor personnel who may be well suited for performing the requirement but may be lacking—for example, a complete college degree or the exact years of specified experience.1 For some services, in fact, such practices are prohibited. Section 813 of the National Defense Authorization, Fiscal Year 2001, now implemented in the FAR, states that solicitations for information technology services may not describe any minimum experience or educational requirements for proposed contractor personnel unless the contracting officer determines that the agency either (1) cannot meet its needs without that requirement or (2) requires the use of other than a performance-based contract.
Socioeconomic Development Programs
Depending on the theater and the mission, socioeconomic programs can be implemented in-theater if applicable. For example, the Iraqi First and Afghanistan First programs seek to leverage contracting resources for the creation of economic expansion, employment, and skills development for the people in those theaters.
To provide a stable source of jobs in Iraq and Afghanistan, the contracting officer may acquire supplies or services (including construction), other than small arms, in support of operations in Iraq or Afghanistan, by performing the following.
- Specifying a preference for supplies or services from Iraq or Afghanistan
- Limiting competition to supplies or services from Iraq or Afghanistan
- Using procedures other than competitive procedures to award a contract to a particular source or sources from Iraq or Afghanistan
Planning for the Evaluation of Proposals
The statement of objectives/statement of work/performance work statement (SOO/SOW/PWS), along with Sections L ("Instructions, Conditions, and Notices to Bidders, Offerors, or Quoters") and M ("Evaluation Factors for Award") of the solicitation, establish the principal ground rules for acquisitions. The SOO/SOW/PWS is the portion of the contract that describes the work to be done through the use of specifications, minimum requirements, quantities, performance dates, time and place of performance, and quality. It identifies the supplies or services the United States (US) government is requesting. The PWS is a statement of work for performance-based acquisitions that describes the required results in clear, specific, and objective terms with measurable outcomes.
Evaluation factors generally fall into four groups.
- Technical
- Cost or price
- Past performance
- Other
Types of Source Selections
The contingency contracting officer (CCO) may request the assistance of the COR in evaluating contractor proposals within the source selection process. In different types of acquisitions, the relative importance of cost or price may vary. For example, in acquisitions for which the requirement is clearly definable and the risk of unsuccessful contract performance is minimal, cost or price may play a dominant role in source selection.
However, if the requirement is less definitive, involves more development work, or entails greater performance risk, technical or past performance considerations may play a more dominant role in source selection than cost or price.
Under either approach, the COR, because of his or her technical knowledge and background, may become part of the team of technical personnel assembled to evaluate contractor proposals. During this process, the CCO and the technical evaluation team chief will provide the COR with detailed instructions concerning his or her role and responsibilities.
The CCO is responsible for preparing the solicitation with assistance from the COR and other experts. However, the CCO gets much of the information directly from supporting documentation and the COR.
The US government uses requests for proposals (RFP) in negotiated acquisitions to communicate government requirements to prospective contractors and to solicit proposals. The RFP must describe the government's requirement, the anticipated terms and conditions of the contract, and the proposal's evaluation factors.
Competition
The FAR authorizes a wide range of acquisition methods tied to varying dollar thresholds, but according to FAR Part 13, Simplified Acquisition Procedures, most acquisition needs in a declared contingency operation can be satisfied through the use of simplified acquisition procedures (SAP). SAP includes procedures for the acquisition of supplies and services (including military construction) when the aggregate amount does not exceed the simplified acquisition threshold (SAT). For declared contingency or peacekeeping operations outside the continental United States, the SAT is $1M (versus $100K in normal operations),2 and the threshold for acquisition of commercial items is $11M (versus $5.5M in normal operations) under FAR Part 12, Acquisition of Commercial Items. The COR should consult with the contracting officer to ensure use of the most appropriate and expeditious method for a specific acquisition need.3
For all planned acquisitions above the SAT, the FAR requires the contracting officer to consider both price and nonprice factors (past performance in particular) when evaluating proposals. The relative importance of those factors is up to the contracting officer or other source selection authority. Federal statutes and the FAR establish the policy for describing agency needs, and they stipulate that requirements be written in a way that promotes full and open competition as required by the objectives of the Competition in Contracting Act (CICA).
FAR Subpart 6.3, Other Than Full and Open Competition, explains when it is appropriate to contract without providing for full and open competition. Contracting without providing for competition cannot be based on lack of advance planning or concerns related to the amount of funds available for the acquisition. Statutory authorities permit contracting without providing for full and open competition when one of the criteria listed in FAR 6.302, Circumstances Permitting Other Than Full and Open Competition, can be justified.
- FAR 6.302-1—availability of only one responsible source that can provide the supplies or services needed to satisfy requirements
- FAR 6.302-2—unusual and compelling urgency
- FAR 6.302-3—industrial mobilization, engineering, or research capability, expert services
- FAR 6.302-4—international agreement
- FAR 6.302-5—authorized or required by statute
- FAR 6.302-6—national security
- FAR 6.302-7—public interest
Restrictive provisions and conditions severely restrict competition, and they are limited to the extent necessary to satisfy the government's needs. When restrictive provisions are used, they must be justified in writing.
Amending the Solicitation
It may be necessary to amend the solicitation after release and prior to contract award. This circumstance could occur for a variety of reasons (for example, changes to the specifications, terms or conditions, or quantities required). However, amendments to solicitations increase administrative effort and cost, and they may delay contract award and performance.
Do's and Don't for pre-award solicitation are outlined in Table 9.
Do's | Don'ts |
Use market research. Look for commercial solutions. |
Write vague specifications, assuming that "the contractor will do whatever is necessary to satisfy us." |
Promote full and open competition. |
Write design specifications, prescribing in detail what materials should be use and how the work should be performed. |
Think about contract administration requirements while writing the SOO/SOW/PWS or the specifications. |
Ask for progress reports, test samples, or other items from the contractor unless the items are needed for the program or for efficient administration and monitoring. |
Use performance-based or functional (rather than design) specifications to describe an objective or standard to be achieved, allowing the contractor to exercise ingenuity in achieving that objective or standard, select the means, and assume corresponding responsibility. |
|
Limit use of restrictive provisions to satisfy agency needs. |
|
Limit use of specifications and instead focus on function, performance, and physical characteristics. |
|
In the SOO/SOW/PWS and specifications, separate discussion of administrative and progress reporting requirements from discussion of required procedures and deliverables. |
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Table 9. Do's and Don'ts for Pre-award and Solicitation
Evaluation and Award
Receiving and Managing Proposals
Offerors must submit their proposals, any proposal revisions, and modifications to the government office designated in the solicitation by the time specified in the solicitation. Proposed contractors may use any transmission method authorized by the solicitation (such as electronically, by regular mail, or by fax). Upon receipt, proposals must be safeguarded from unauthorized disclosure throughout the source selection process.
Note: The source selection team must not reveal any information related to the identity or number of proposed contractors and information concerning any proposal or the status of any proposal in relation to others. Release of such information could jeopardize any resultant award and subject the individuals involved to disciplinary action, as well as to civil and, in some cases, criminal penalties.
After the closing date, the contracting officer will forward the technical proposals to the technical evaluation team lead for analysis. The contracting officer normally will retain the business/cost proposals until the technical evaluation is completed.
Evaluating Proposals
The acquisition team will review and evaluate all proposals submitted in response to an applicable solicitation, based on the evaluation factors provided in Section M of the solicitation. The technical evaluation team is responsible for evaluating the technical proposals; rating them in order of merit; making recommendations to the contracting officer regarding clarifications needed and deficiencies identified; reviewing supplemental and revised offers; and, if required, assisting the contracting officer during negotiations. To the extent possible, the same evaluators should be available throughout the entire evaluation and selection process to ensure continuity and consistency in the treatment of proposals.
Technical Evaluation Reports
When the contracting officer forwards the technical proposals to the technical evaluation team for analysis, the technical proposals are accompanied by specific guidance for conducting the evaluation and preparing the technical evaluation report. The team lead prepares and signs the report and submits it to the contracting officer, who maintains it as a permanent record in the contract file. The report should present the proposal ratings and identify each proposal as acceptable or unacceptable.
The technical evaluation report must include a narrative evaluation specifying the strengths and weaknesses of each proposal and any uncertainties, reservations, qualifications, or areas to be addressed that might affect the selection of the source for award. The report should include specific points and questions for subsequent discussions with the proposed contractors. If the technical evaluation team determines a proposal is technically unacceptable, the report is passed to the contracting officer for his or her final determination.
Assisting in the Review of Business and Cost Proposals
The contracting officer is responsible for evaluating the factors related to cost and price analysis and determining the contractor's responsibility (for example, adequacy of resources, ability to comply with delivery or performance schedule, and satisfactory record of performance). The contracting officer may need the COR's assistance to effectively accomplish this evaluation.
Communicating with Proposed Contractors
In the interval between the release of the solicitation and contract award, all contact with offerors relating to the particular acquisition must be coordinated through the contracting officer.
The COR may be asked to assist the contracting officer when clarifications (limited exchanges) between the government and the proposed contractors are needed, when awarding contracts without discussions, or when communications are needed for establishing the competitive range.
Determining the Competitive Range
Considering the ratings of each proposal against all evaluation criteria, the contracting officer establishes a competitive range consisting of the most highly rated proposals. Provided the solicitation notifies proposed contractors that the competitive range can be limited for purposes of efficiency, the contracting officer may limit the number of proposals in the competitive range to permit an efficient competition among the most highly rated proposals. The COR may be asked to assist the contracting officer with debriefing proposed contractors that are excluded or otherwise eliminated from the competitive range.
Communications after Establishing the Competitive Range
In either a competitive or sole-source environment, negotiations are exchanges undertaken between the government and proposed contractor with the intent of allowing the proposed contractor to revise its proposal. These negotiations may include bargaining. Bargaining includes persuasion, alteration of assumptions and positions, and give-and-take discussion. Bargaining may apply to price, schedule, technical requirements, type of contract, or other terms of a proposed contract. Negotiations in a competitive acquisition take place after establishing the competitive range; these negotiations are known as meaningful discussions.
The contracting officer tailors meaningful discussions to each proposed contractor's proposal. The contracting officer must conduct meaningful discussions with each proposed contractor within the competitive range. The primary objective of meaningful discussions is to maximize the government's ability to obtain best value, based on the requirement and the evaluation factors identified in the solicitation.
During meaningful discussions, the contracting officer should discuss with each proposed contractor any deficiencies, significant weaknesses, and adverse past performance information to which the proposed contractor has not yet had an opportunity to respond. This may include other aspects of the proposed contractor's proposal that could be altered or explained to materially enhance the proposal's potential for award. However, this does not mean that the contracting officer is required to discuss every area where the proposal could improve.
The scope and extent of discussions are at the discretion of the contracting officer's judgment. A COR may be asked to participate in discussions with proposed contractors in the competitive range.
Note: Under no circumstances may the COR discuss an offeror's proposal with any of the other offerors.
Selecting the Right Contractor
Upon receipt of revised proposals or other responses to questions raised during meaningful discussions, the technical evaluation team will reevaluate the proposals in the competitive range. The results of these evaluations will be documented in writing and submitted to the contracting officer.
The contracting officer will review the latest set of evaluations. Note that the source selection authority (SSA) may be someone other than the contracting officer, as appointed by the head of the agency. Based on a comparative assessment of proposals against all source selection criteria in the solicitation, the contracting officer will then rate the proposals. Although the contracting officer may use reports and analyses prepared by others, the source selection decision represents the contracting officer's independent judgment. Documentation for the source selection decision includes the rationale for any business judgments and tradeoffs made or relied on by the contracting officer, including benefits associated with additional costs.
Debriefing Proposed Contractors
Contracting officers may debrief successful and unsuccessful proposed contractors orally, in writing, or by any other method. The contracting officer normally chairs the debriefing session. Individuals from the evaluation teams provide support at the debriefing.
At a minimum, the following information must be included in the debriefing.
- Significant weaknesses or deficiencies in the proposed contractor's proposal, if applicable
- Overall evaluated cost or price (including unit prices) and technical rating (if applicable) of the selected contractor and the unsuccessful proposed contractor, and past performance information of the unsuccessful proposed contractor
- Overall ranking of all proposed contractors
- Summary of the rationale for the contract award
- For acquisitions of commercial items, the make and model of the item to be delivered by the selected contractor
- Reasonable responses to relevant questions about whether source selection procedures contained in the solicitation, applicable regulations, and other applicable authorities were followed
Note: Debriefings must not include point-by-point comparisons of the proposed contractors' proposals, nor may debriefings divulge any other prohibited information about other proposed contractors.
Handling Protests
Any interested party may file a protest against the government concerning a contracting action. Interested parties can file such protests directly with the contracting agency or with the Government Accountability Office (GAO).
Interested parties must file protests by the later of the following:
- 10 days after contract award,
- 5 days after a debriefing, or
- 10 calendar days after the basis of the protest is known (or should have been known).
An agency is required to make its best efforts to resolve agency protests within 35 days after the protest filing date, while the GAO has 100 days to resolve the protest. In the case of a protest filed with the GAO, either party can request a 65-day express option.
After an interested party files a protest, the government contracting officer must suspend work on the contract unless the agency head determines doing so would not be in the best interest of the government.4
Note: The government does not accept late protest submissions.
Handling Freedom of Information Act Requests
The Freedom of Information Act (FOIA) specifies how federal agencies will make their records available for public review (upon request), sets time standards for compliance actions, and details those records that are exempt from public disclosure. A US government contract is a public document. The reports that a contractor must submit in compliance with the terms and conditions of a service contract are likewise public documents with certain exceptions, such as the following.
- Classified information
- Source selection information
- Trade secrets and confidential commercial or financial information (sometimes referred to as proprietary information)
- Interagency or intra-agency memoranda or correspondence
- Personal and medical information pertaining to an individual
If a contractor requests information under the provisions of FOIA, the COR should immediately refer the contractor to the contracting officer or base FOIA monitor. The FOIA monitor will establish a suspense, not to exceed 20 calendar days, for each request. Remember—it is not the COR's job to determine whether information is releasable.
Do's and don'ts for evaluation and award are provided in Table 10.
Do's | Don'ts |
Carefully review the contract, especially the technical requirements. |
Divulge budget information to prospective contractors. |
Develop, or obtain from the contractor, a detailed schedule of performance. |
Assume without reading it that the SOO/SOW/PWS is complete, clear, and fully understandable. |
Work with the contracting officer and the contractor to clear up any misunderstandings and to establish organized contract administration and monitoring procedures |
Allow planning to become an end in itself. Remember: the goal is to get results, not just pretty charts showing the "plan." |
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Forget to update plans and schedules as the situation changes. |
|
Overlook or ignore contract requirements for government-furnished property (GFP), timely reviews and approvals, or technical assistance and direction. |
Table 10. Do's and Don'ts for Evaluation and Award
Notes
- Department of Defense, Guidebook for Performance-Based Services Acquisition (PBSA). Top
- See 10 USC 2302(7), Rules Governing Contents of Warranties. For declared domestic contingency operations, the SAT is raised to $250K. Top
- FAR Case 2008-024 (4 February 2010) and DFARS Case 2009-D003 (20 January 2010), both titled Inflation Adjustment of Acquisition-Related Thresholds, propose changes to the SAT under Section 807 of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005. Section 807 provides for adjustment every 5 years of statutory acquisition-related thresholds. Top
- Per DFARS 202.101, Definitions, the term "head of the agency" means, for DoD, the Secretary of Defense, the Secretary of the Army, the Secretary of the Navy, and the Secretary of the Air Force. Subject to the direction of the Secretary of Defense, the Under Secretary of Defense (Acquisition, Technology and Logistics), and the Director of Defense Procurement and Acquisition Policy, the directors of the defense agencies have been delegated authority to act as head of the agency for their respective agencies (to perform functions under the FAR or DFARS reserved to a head of agency or agency head), except for such actions that by terms of statute, or any delegation, must be exercised within the Office of the Secretary of Defense. (For emergency acquisition flexibilities, see DFARS 218.270, Head of Contracting Activity Determinations.) Top
Appendix Acronyms
CCO – Contingency Contracting Officer
CICA – Competition in Contracting Act
COR – Contracting Officer's Representative
FAR – Federal Acquisition Regulation
FOIA – Freedom of Information Act
GAO – Government Accountability Office
GFP – Government Furnished Property
IGE – Independent Government Cost Estimates
PWS – Performance Work Statement
RFP – Request for Proposal
SAP – Simplified Acquisition Procedures
SAT – Simplified Acquisition Threshold
SOO – Statement of Objectives
SOW – Statement of Work
US – United States