Contract Management: Key Role Past Performance Reporting Plays in the Acquisition Lifecycle Julia B. Wise Senior Procurement Policy Analyst Office of Federal Procurement Policy Office of Management and Budget

Scope - Government Coverage US Procurement System Scope - Government Coverage 112 Departments & agencies around the world 3,400 Contracting Offices The People 30,000 Contracting Officers (FAR 1.602) Contracting Officer’s Representatives (FAR 1.604) Program Managers 300,000 purchase card holders The FAR System governs the "acquisition process" by which the government purchases (acquires) goods and services. The process consists of three phases: (1) need recognition and acquisition planning, (2) contract formation, and (3) contract administration. The FAR System regulates the activities of government personnel in carrying out that process. The FAR System is codified at Title 48, Chapter 1 of the United States Code of Federal Regulations. OFPP Memorandum on FAC-COR: http://www.fai.gov/pdfs/FAC-COR_20Sep2011.pdf

Contract Objective Contract” means a mutually binding legal relationship obligating the seller to furnish the supplies or services (including construction) and the buyer to pay for them. (FAR Part 2) Obtain the best value for the government in procuring quality goods and services at a reasonable price in a timely manner Seek to maximize full and open competition Promote small business participation in government contracting Obtain innovative goods and services Obtain quality performance and supplies to ensure the customer’s needs are met and the taxpayers dollars are spent wisely.

OFPP Past Performance Initiative Past performance information is relevant information, for future source selection purposes, regarding a contractor’s actions under previously awarded contracts. (FAR 42.1501). Since 2009, OFPP has taken several actions to increase the number and quality of past performance submissions available to source selection officials, including: • emphasizing reporting requirements through memos to agency officials; • assessing and reporting on the level of compliance and quality of evaluations; • directing the development of a compliance tracking tool; • setting performance targets for certain agencies; • directing the consolidation of systems for entering past performance information; and • developing government-wide past performance guidance. It includes, for example, the contractor’s record of conforming to contract requirements and to standards of good workmanship; the contractor’s record of forecasting and controlling costs; the contractor’s adherence to contract schedules, including the administrative aspects of performance; the contractor’s history of reasonable and cooperative behavior and commitment to customer satisfaction; the contractor’s record of integrity and business ethics, and generally, the contractor’s business-like concern for the interest of the customer

Acquisition Team Key Acquisition Team Players Contracting Officer and Contract Specialist COR - Technical Community Quality Assurance Budget/ Finance Officer Legal Counsel Program Manager or Project Manager Customer /End-user Designed for Use by: Contracting Officers Program and Procurement Analysts Senior Procurement Executives Congress, state, and local governments System Administrators Media, research groups, marketing groups, students, and commercial businesses All other interested public parties

Pre-Award Process in Requiring Activity/Program Office Google, Check FPDS, PPIRS, FAPIIS Prepare acquisition package: SOW/SOO/PWS Draft Evaluation Criteria/ Plan Define the Requirement Develop Funding and Requisition Document Prepare Independent Government Cost Estimate Conduct Market Research KEY: SOW – Statement of Work SOO – Statement of Objective PWS – Performance Work Statement

Pre-Award Process in the Contracting Office Receive Procurement Package Assign CO/Buyer Buyer Reviews Validate Market Research Finalize Acquisition Strategy/Plan Issue RFQ/RFP Management Review Legal Review Draft RFQ/RFP Receive Offer/Compliance Review Technical Evaluation of Offer/Price Determine LPTA/ Best Value Procurement Management Review Contract Performance Debrief Offeror Award Legal Review

Award: Source Selection Process Technical Proposal Including PPI and Cost proposal Individual Evaluations of proposals based on solicitation criteria RFP/RFQ Issued RFP/RFQ Offer Received Source Selection Panel Caucus Contract Award Award Decision Debriefings SSA Briefing Comments Strengths Weaknesses Deficiencies Merit & Confidence Ratings Consensus Strengths Weaknesses Deficiencies Merit & Confidence Ratings Cost Issues KEY: RFP – Request for Proposal RFQ – Request for Quote SSA – Source Selection Authority LPTA – Lowest Price Technically Acceptable

Post-Award: Contract Management Process Quality Surveillance Plan - used to monitor Contract Performance Prepare the Contract File Kick-Off Post-Award Conference or Meeting Document Contract Performance Modification Issued – within scope changes Contract Closeout Invoice Payments

Contract Management Objective: Achieve the contract objective and outcomes. What is it? The art and science of formulating, executing, administering and closing a contract transaction between the government and the contractor. Who participates? The government and contractor participate in the contract management process. What governs the process? Contract regulations that govern this process (FAR Part 42, Contract Administration and Audit Services)

Contract Management Best Practices Tips Good Solicitation + Sound Contract Award = Good Contract Management Starts with acquisition planning – the beginning dictates the end results Plan for good contract management – develop a contract administration plan that measures the contractor's performance and supports payment Start with a post-award conference . Recommendations: Know what you buying. Establish an Acquisition Team or Integrated Project Team that can supplement your expertise. Develop a Clear and Concise Clear Requirements with performance metrics. Hold frequent meetings with contractors (subcontractors, if necessary) and document performance results Designate a P/PM and COR upfront before the solicitation is issued. Hold contractors accountable and manage the contract to success involves activities performed by government officials after contract award to determine how well the government and the contractor performed to meet the contract requirements. encompasses dealings between the government and the contractor from contract award until the work has been completed and accepted or the contract terminated, payment has been made, and disputes have been resolved. constitutes that primary part of the procurement process that assures the government gets what it paid for. focus on obtaining quality supplies and services on time and within budget. Usually eliminate or minimize problems at: During the solicitation phase Time of award During contract performance Documents unique Terms and Conditions as well as any statutory requirements Provides best value for the taxpayers’ dollars Improves customers’ satisfaction PBA, is where we state the outcome and the contract is responsible and accountable to provide that out Use watch example. Supports PMA.

What requires past performance evaluation? 1994 Federal Acquisition Streamlining Act (FASA) dated October 13, 1994 (Public Law 103-355) It is appropriate and relevant that a contracting official consider a contractor’s past performance as an indicator that the offeror will successfully perform a contract to be awarded. Federal Acquisition Regulation (FAR) 15.304(c)(iii) FAR Part 42., Contract Administration and Audit Services FAR 42.15, Past Performance Information FAR is available at www.acquisition.gov/far The purpose of the FAR is to provide "uniform policies and procedures for acquisition."[1] Among its guiding principles is to have an acquisition system that satisfies customer's needs in terms of cost, quality, and timeliness; minimize administrative operating costs; conduct business with integrity, fairness, and openness; and fulfill other public policy objectives.[2] Agencies are required to: submit an electronic record of contractor performance in the Past Performance Information Retrieval System (PPIRS) - single, government-wide repository for contractor performance information on all actions over $150,000 (other thresholds exist for construction and A&E actions) establish internal procedures for collecting and reporting past performance information to PPIRS identify agency officials responsible for preparing interim and final performance evaluations; and consider the achievement of small business goals in performance evaluations when the contract includes a Small Business Subcontracting Plan.

Mission and Business Plan Procurement/Contracting Acquisition Roles Mission and Business Plan Budget Acquisition Plan Procurement/Contracting Managing and Measuring Results Program manager, requiring officials, contract specialist, contracting officer, logistics, others as needed. Program manager and requiring officials primary in this step All with contracting officer representative and program office leading Add budget officer, financial management All of the above and add cost/price analyst as needed. Contracting officer primary in this step. All with contracting officer leading

Where is Past Performance/Integrity information reported? The Contract Performance Assessment Reporting System (CPARS) is a web-enabled system used to document contractor and grantee performance information as required by Federal Regulations. Completed CPARS reports are transmitted to the Past Performance Information Retrieval System (PPIRS) where they are used to support future acquisitions. CPARS includes Best Practices and a Quality Checklist that help agencies write quarterly evaluation reports. The Past Performance Information Retrieval System (PPIRS) is a web-enabled, enterprise application that provides timely and pertinent contractor past performance information to the Department of Defense and Federal acquisition community for use in making source selection decisions. The Federal Awardee Performance and Integrity Information System (FAPIIS) is a web-enabled application used to collect certain information on contractor and grantee performance. FAPIIS information is publicly available at www.fapiis.gov. The Federal Awardee Performance and Integrity Information System (FAPIIS) is a web-enabled application used to collect contractor and grantee performance information including Terminations for Cause or Default, Defective Cost and Pricing Data, Determinations of Non-Responsibility, Terminations for Material Failure to Comply (grants), Recipient Not Qualified Determinations (grants), Department of Defense (DoD) Determinations of Contractor Fault, and Administrative Agreements. FAPIIS also includes contractor self-reported Criminal Convictions, Civil Proceedings, Administrative Proceedings, and settlements.

What are the Benefits of Past Performance Information Validates statements made in proposal Integral to best value source selection Motivates contractors to strive for excellence Recognizes good performance Reduces risk and oversight Confirms that government obtained the outcomes awarded. Contractor can eventually be paid for services and supplies delivered. Why evaluate past performance? The main purpose of the past performance evaluation is to appropriately consider each offeror’s demonstrated record of performance in supplying products and services that meet users’ needs including cost and schedule. (MP5315.3, paragraph 5.5.3) Why evaluate past performance? To aid the government’s decision process and award contracts to those companies that consistently produce and deliver quality products, on time and within cost!

Recent GAO Report: Past Performance Reporting Rate of Compliance with Past Performance Reporting Requirement as of April 2013 and April 2014 for Top 10 Agencies Based on Number of Compliance Rate due Agency April 2013 April 2014 Defense 76% 83% Treasury 47 71 Interior 15 51 Homeland Security 34 45 Justice 21 29 Agriculture 13 27 Veterans Affairs 4 25 Health and Human Services 10 24 State 3 General Services Administration Other agencies 32 Total federal government 32% 49% Source: Past Performance Information Retrieval System | GAO-14-707

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