Certified Federal Contracts Manager NCMA

Certified Federal Contracts Manager NCMA
FAR Federal Acquisition Regulation SLIDE 1 CDC PGO Feb-Mar, 2010

Part 7: Acquisition Planning Part 8: Required Sources
Federal Acquisition Regulation Part 7: Acquisition Planning Part 8: Required Sources Part 9: Contractor Qualifications Part 10: Market Research SLIDE 2

Acquisition Planning: The Concepts
Contracting official’s role has expanded Part of the organization’s management team Business management Acquisition planning is a multi-disciplinary team effort by: Contracting professional Customer Budget and finance experts Legal counsel Direct and indirect stakeholders SLIDE 3 NCMA, Contract Management Body of Knowledge p. 22, bottom of column 2.

Acquisition Planning: The Concepts
“The planning process should begin before the traditional first customer contact, and should have an inward, as well as an outward, focus; particularly as it relates to an important acquisition planning tool – market research.” NCMA SLIDE 4 NCMA, “Contract Management Body of Knowledge,” p. 22, last line 3.1, column 2

Internal Market Research - Internal Scanning Techniques NCMA
Review historical information on prior acquisitions Attend management meetings of internal customers Receive detailed briefings on functions and processes of internal customers Divide short-term assignments into customer work units Read pertinent customer-oriented publications Serve in groups that have little to do with contracting Share information on contracting issues and trends with other managers SLIDE 5 NCMA, “Contract Management Body of Knowledge,” p. 23

External Market Research - External Scanning Techniques NCMA
Review historical information on similar prior acquisitions for related market information Review pertinent professional news, trade, association, or industry publications Contact knowledgeable third-party sources of unbiased information regarding potential sources Attend trade or professional association shows and exhibits Contact customers of potential sources for past performance information Review catalogs and other printed or electronic information published by potential sources Contact potential sources for specific capabilities information or briefings Join pertinent professional organizations and attend their meetings SLIDE 6 NCMA, “Contract Management Body of Knowledge,” p. 23

Sources of Cost and Pricing Information Government Contract Pricing
Acquisition Central by Integrated Acquisition Environment (IAE) Bureau of Labor Statistics Central Contractor Registration (CCR) Davis-Bacon Wage Determinations Defense Contract Audit Agency (DCAA) Defense Procurement and Acquisition Policy (DPAP) and Strategic Sourcing DPAP Contract Pricing Reference Guides Federal Aviation Administration (FAA) Pricing Handbook General Services Administration (GSA) SLIDE 7 Appendix B CONDUCTING COST ANALYSIS AND COST REALISM ANALYSIS draft SOP Adapted from: Financial Analysis of Contract Proposals and Modifications, NIH Policy Manual

Sources of Information Government Contract Pricing
Government Contractor Resource Center National Contract Management Association Small Business Administration (SBA) Wage Determinations On-line Service Contract Act of 1965, as Amended SLIDE 8 Appendix B CONDUCTING COST ANALYSIS AND COST REALISM ANALYSIS draft SOP Adapted from: Financial Analysis of Contract Proposals and Modifications, NIH Policy Manual

Acquisition Plan Contents
Description of need (concise but complete) Conditions and/or constraints i.e. computer specifications for specific software i.e. implementation issues such as space, time, sequence Established cost targets Required performance characteristics SLIDE 9 Contract Management Body of Knowledge, NCMA, p. 24

Delivery or performance period requirements Trade-offs related to plan costs, technical performance, capability, and schedule requirements Discussion of the level of risk Slide 10 Contract Management Body of Knowledge, NCMA, p. 22

Action Plan with: Proposed sources Degree of competition anticipated Proposed contract type(s) Source selection process including evaluation factors related to acquisition goals Post award administration plan Milestones or target dates Other pertinent issues (FAR 7.105)a SLIDE: 11 Contract Management Body of Knowledge, NCMA, p. 24

7.102 Policy Agencies shall perform acquisition planning and conduct market research (see Part 10) for all acquisitions in order to promote and provide for— (1) Acquisition of commercial items (2) Full and open competition (see Part 6) (b) This planning shall integrate the efforts of all personnel responsible for significant aspects of the acquisition. The purpose of this planning is to ensure that the Government meets its needs in the most effective, economical, and timely manner. Slide 12 7.102 Policy. (a) Agencies shall perform acquisition planning and conduct market research (see Part 10) for all acquisitions in order to promote and provide for— (1) Acquisition of commercial items or, to the extent that commercial items suitable to meet the agency’s needs are not available, nondevelopmental items, to the maximum extent practicable (10 U.S.C. 2377 and 41 U.S.C. 251, et seq.); and (2) Full and open competition (see Part 6) or, when full and open competition is not required in accordance with Part 6, to obtain competition to the maximum extent practicable, with due regard to the nature of the supplies or services to be acquired (10 U.S.C. 2301(a)(5) and 41 U.S.C. 253a(a)(1)). (b) This planning shall integrate the efforts of all personnel responsible for significant aspects of the acquisition. The purpose of this planning is to ensure that the Government meets its needs in the most effective, economical, and timely manner. Agencies that have a detailed acquisition planning system in place that generally meets the requirements of and need not revise their system to specifically meet all of these requirements.

FAR 7.107 Bundling Con Pro Potential disadvantage to small business
The Head of Agency Must Conduct Market Research to Determine the Necessity of Bundling and Justify that the Agency or the Government Benefits. Con Potential disadvantage to small business Pro May result in substantial savings to the Government SLIDE 13 7.107 Additional requirements for acquisitions involving bundling. (a) Bundling may provide substantial benefits to the Government. However, because of the potential impact on small business participation, the head of the agency must conduct market research to determine whether bundling is necessary and justified (15 U.S.C. 644(e)(2)). Market research may indicate that bundling is necessary and justified if an agency or the Government would derive measurably substantial benefits (see (a)(2)(iv) and (a)(3)(vi)). (b) Measurably substantial benefits may include, individually or in any combination or aggregate, cost savings or price reduction, quality improvements that will save time or improve or enhance performance or efficiency, reduction in acquisition cycle times, better terms and conditions, and any other benefits. The agency must quantify the identified benefits and explain how their impact would be measurably substantial. Except as provided in paragraph (d) of this section, the agency may determine bundling to be necessary and justified if, as compared to the benefits that it would derive from contracting to meet those requirements if not bundled, it would derive measurably substantial benefits equivalent to— (1) Ten percent of the estimated contract or order value (including options) if the value is $86 million or less; or (2) Five percent of the estimated contract or order value (including options) or $8.6 million, whichever is greater, if the value exceeds $86 million. (c) Without power of delegation, the service acquisition executive for the military departments, the Under Secretary of Defense for Acquisition, Technology and Logistics for the defense agencies, or the Deputy Secretary or equivalent for the civilian agencies may determine that bundling is necessary and justified when— (1) The expected benefits do not meet the thresholds in paragraphs (b)(1) and (b)(2) of this section but are critical to the agency’s mission success; and (2) The acquisition strategy provides for maximum practicable participation by small business concerns. (d) Reduction of administrative or personnel costs alone is not sufficient justification for bundling unless the cost savings are expected to be at least 10 percent of the estimated contract or order value (including options) of the bundled requirements. (e) Substantial bundling is any bundling that results in a contract or order that meets the dollar amounts specified in 7.104(d)(2). When the proposed acquisition strategy involves substantial bundling, the acquisition strategy must additionally— (1) Identify the specific benefits anticipated to be derived from bundling; (2) Include an assessment of the specific impediments to participation by small business concerns as contractors that result from bundling; (3) Specify actions designed to maximize small business participation as contractors, including provisions that encourage small business teaming; (4) Specify actions designed to maximize small business participation as subcontractors (including suppliers) at any tier under the contract, or order, that may be awarded to meet the requirements; (5) Include a specific determination that the anticipated benefits of the proposed bundled contract or order justify its use; and (6) Identify alternative strategies that would reduce or minimize the scope of the bundling, and the rationale for not choosing those alternatives. (f) The contracting officer must justify bundling in acquisition strategy documentation. (g) In assessing whether cost savings would be achieved through bundling, the contracting officer must consider the cost that has been charged or, where data is available, could be charged by small business concerns for the same or similar work. (h) The requirements of this section, except for paragraph (e), do not apply if a cost comparison analysis will be performed in accordance with OMB Circular A-76.

FAR 7.107(b) Bundling Except as provided in paragraph (d) of this section, the agency may determine bundling to be necessary and justified if, as compared to the benefits that it would derive from contracting to meet those requirements if not bundled, it would derive measurably substantial benefits equivalent to— (1) Ten percent of the estimated contract or order value (including options) if the value is $86 million or less; or (2) Five percent of the estimated contract or order value (including options) or $8.6 million, whichever is greater, if the value exceeds $86 million. SLIDE 14 b) Measurably substantial benefits may include, individually or in any combination or aggregate, cost savings or price reduction, quality improvements that will save time or improve or enhance performance or efficiency, reduction in acquisition cycle times, better terms and conditions, and any other benefits. The agency must quantify the identified benefits and explain how their impact would be measurably substantial. Except as provided in paragraph (d) of this section, the agency may determine bundling to be necessary and justified if, as compared to the benefits that it would derive from contracting to meet those requirements if not bundled, it would derive measurably substantial benefits equivalent to— (1) Ten percent of the estimated contract or order value (including options) if the value is $86 million or less; or (2) Five percent of the estimated contract or order value (including options) or $8.6 million, whichever is greater, if the value exceeds $86 million. (c) Without power of delegation, the service acquisition executive for the military departments, the Under Secretary of Defense for Acquisition, Technology and Logistics for the defense agencies, or the Deputy Secretary or equivalent for the civilian agencies may determine that bundling is necessary and justified when— (1) The expected benefits do not meet the thresholds in paragraphs (b)(1) and (b)(2) of this section but are critical to the agency’s mission success; and (2) The acquisition strategy provides for maximum practicable participation by small business concerns. (d) Reduction of administrative or personnel costs alone is not sufficient justification for bundling unless the cost savings are expected to be at least 10 percent of the estimated contract or order value (including options) of the bundled requirements. (e) Substantial bundling is any bundling that results in a contract or order that meets the dollar amounts specified in 7.104(d)(2). When the proposed acquisition strategy involves substantial bundling, the acquisition strategy must additionally— (1) Identify the specific benefits anticipated to be derived from bundling; (2) Include an assessment of the specific impediments to participation by small business concerns as contractors that result from bundling; (3) Specify actions designed to maximize small business participation as contractors, including provisions that encourage small business teaming; (4) Specify actions designed to maximize small business participation as subcontractors (including suppliers) at any tier under the contract, or order, that may be awarded to meet the requirements; (5) Include a specific determination that the anticipated benefits of the proposed bundled contract or order justify its use; and (6) Identify alternative strategies that would reduce or minimize the scope of the bundling, and the rationale for not choosing those alternatives. (f) The contracting officer must justify bundling in acquisition strategy documentation. (g) In assessing whether cost savings would be achieved through bundling, the contracting officer must consider the cost that has been charged or, where data is available, could be charged by small business concerns for the same or similar work. (h) The requirements of this section, except for paragraph (e), do not apply if a cost comparison analysis will be performed in accordance with OMB Circular A-76.

7.202 Policy. Economic Order Quantity (EOQ)
(a) Agencies are required by 10 U.S.C. 2384(a) and 41 U.S.C. 253f to procure supplies in such quantity as— (1) Will result in the total cost and unit cost most advantageous to the Government, where practicable; and (2) Does not exceed the quantity reasonably expected to be required by the agency. (b) Each solicitation for a contract for supplies is required, if practicable, to include a provision inviting each offeror responding to the solicitation— (1) To state an opinion on whether the quantity of the supplies proposed to be acquired is economically advantageous to the Government; and (2) If applicable, to recommend a quantity or quantities which would be more economically advantageous to the Government. Each such recommendation is required to include a quotation of the total price and the unit price for supplies procured in each recommended quantity. SLIDE 15 Subpart 7.2—Planning for the Purchase of Supplies in Economic Quantities 7.200 Scope of subpart. This subpart prescribes policies and procedures for gathering information from offerors to assist the Government in planning the most advantageous quantities in which supplies should be purchased. 7.201 [Reserved] 7.202 Policy. (a) Agencies are required by 10 U.S.C. 2384(a) and 41 U.S.C. 253f to procure supplies in such quantity as— (1) Will result in the total cost and unit cost most advantageous to the Government, where practicable; and (2) Does not exceed the quantity reasonably expected to be required by the agency. (b) Each solicitation for a contract for supplies is required, if practicable, to include a provision inviting each offeror responding to the solicitation— (1) To state an opinion on whether the quantity of the supplies proposed to be acquired is economically advantageous to the Government; and (2) If applicable, to recommend a quantity or quantities which would be more economically advantageous to the Government. Each such recommendation is required to include a quotation of the total price and the unit price for supplies procured in each recommended quantity. 7.203 Solicitation provision. Contracting officers shall insert the provision at , Economic Purchase Quantity—Supplies, in solicitations for supplies. The provision need not be inserted if the solicitation is for a contract under the General Services Administration’s multiple award schedule contract program, or if the contracting officer determines that— (a) The Government already has the data; (b) The data is otherwise readily available; or (c) It is impracticable for the Government to vary its future requirements. 7.204 Responsibilities of contracting officers. (a) Contracting officers are responsible for transmitting offeror responses to the solicitation provision at to appropriate inventory management/requirements development activities in accordance with agency procedures. The economic purchase quantity data so obtained are intended to assist inventory managers in establishing and evaluating economic order quantities for supplies under their cognizance. (b) In recognition of the fact that economic purchase quantity data furnished by offerors are only one of many data inputs required for determining the most economical order quantities, contracting officers should generally take no action to revise quantities to be acquired in connection with the instant procurement. However, if a significant price variation is evident from offeror responses, and the potential for significant savings is apparent, the contracting officer shall consult with the cognizant inventory manager or requirements development activity before proceeding with an award or negotiations. If this consultation discloses that the Government should be ordering an item of supply in different quantities and the inventory manager/requirements development

Subpart 7.2—Planning for the Purchase of Supplies in Economic Quantities
(b) In recognition of the fact that economic purchase quantity data furnished by offerors are only one of many data inputs required for determining the most economical order quantities, contracting officers should generally take no action to revise quantities to be acquired in connection with the instant procurement. However, if a significant price variation is evident from offeror responses, and the potential for significant savings is apparent, the contracting officer shall consult with the cognizant inventory manager or requirements development activity before proceeding with an award or negotiations. If this consultation discloses that the Government should be ordering an item of supply in different quantities and the inventory manager/requirements development activity concurs, the solicitation for the item should be amended or canceled and a new requisition should be obtained. SLIDE 16 7.203 Solicitation provision. Contracting officers shall insert the provision at , Economic Purchase Quantity—Supplies, in solicitations for supplies. The provision need not be inserted if the solicitation is for a contract under the General Services Administration’s multiple award schedule contract program, or if the contracting officer determines that— (a) The Government already has the data; (b) The data is otherwise readily available; or (c) It is impracticable for the Government to vary its future requirements. 7.204 Responsibilities of contracting officers. (a) Contracting officers are responsible for transmitting offeror responses to the solicitation provision at to appropriate inventory management/requirements development activities in accordance with agency procedures. The economic purchase quantity data so obtained are intended to assist inventory managers in establishing and evaluating economic order quantities for supplies under their cognizance. (b) In recognition of the fact that economic purchase quantity data furnished by offerors are only one of many data inputs required for determining the most economical order quantities, contracting officers should generally take no action to revise quantities to be acquired in connection with the instant procurement. However, if a significant price variation is evident from offeror responses, and the potential for significant savings is apparent, the contracting officer shall consult with the cognizant inventory manager or requirements development activity before proceeding with an award or negotiations. If this consultation discloses that the Government should be ordering an item of supply in different quantities and the inventory manager/requirements development activity concurs, the solicitation for the item should be amended or canceled and a new requisition should be obtained.

Subpart 7.3-Contractor Versus Government Performance
This subpart prescribes policies and procedures for use in acquisitions of commercial or industrial products and services subject to— (a) OMB Circular No. A-76 (Revised) (the Circular), Performance of Commercial Activities; and (b) The Supplement to OMB Circular No. A-76. SLIDE 17 Subpart 7.3—Contractor Versus Government Performance 7.300 [Reserved] 7.301 Definitions. Definitions of “inherently governmental activity” and other terms applicable to this subpart are set forth at Attachment D of the Office of Management and Budget Circular No. A-76 (Revised), Performance of Commercial Activities, dated May 29, 2003 (the Circular). 7.302 Policy. (a) The Circular provides that it is the policy of the Government to— (1) Perform inherently governmental activities with Government personnel; and (2) Subject commercial activities to the forces of competition. (b) As provided in the Circular, agencies shall— (1) Not use contractors to perform inherently governmental activities; (2) Conduct public-private competitions in accordance with the provisions of the Circular and, as applicable, these regulations; (3) Give appropriate consideration relative to cost when making performance decisions between agency and contractor performance in public-private competitions; (4) Consider the Agency Tender Official an interested party in accordance with 31 U.S.C to 3553 for purposes of filing a protest at the Government Accountability Office; and (5) Hear contests in accordance with OMB Circular A-76, Attachment B, Paragraph F. (c) When using sealed bidding in public-private competitions under OMB Circular A-76, contracting officers shall not hold discussions to correct deficiencies.

7.302 Policy. Inherently Governmental Functions
The Circular provides that it is the policy of the Government to (a) rely generally on private commercial sources for supplies and services, if certain criteria are met, while recognizing that some functions are inherently Governmental and must be performed by Government personnel, and (b) give appropriate consideration to relative cost in deciding between Government performance and performance under contract. In comparing the costs of Government and contractor performance, the Circular provides that agencies shall base the contractor’s cost of performance on firm offers. SLIDE 18 7.302 Policy. (a) The Circular provides that it is the policy of the Government to— (1) Perform inherently governmental activities with Government personnel; and (2) Subject commercial activities to the forces of competition. (b) As provided in the Circular, agencies shall— (1) Not use contractors to perform inherently governmental activities; (2) Conduct public-private competitions in accordance with the provisions of the Circular and, as applicable, these regulations; (3) Give appropriate consideration relative to cost when making performance decisions between agency and contractor performance in public-private competitions; (4) Consider the Agency Tender Official an interested party in accordance with 31 U.S.C to 3553 for purposes of filing a protest at the Government Accountability Office; and (5) Hear contests in accordance with OMB Circular A-76, Attachment B, Paragraph F. (c) When using sealed bidding in public-private competitions under OMB Circular A-76, contracting officers shall not hold discussions to correct deficiencies.

Part 8 – Required Sources of Supplies and Services
8.1 Excess Personal Property 8.4 Federal Supply Schedules 8.5 Acquisition of Helium 8.6 Acquisition from Federal Prison Industries, Inc. 8.7 Acquisition from nonprofit Agencies Employing People Who Are Blind or Severely Disabled 8.8 Acquisition of Printing and Related Supplies SLIDE 19 8.401 Definitions. As used in this subpart— “Ordering activity” means an activity that is authorized to place orders, or establish blanket purchase agreements (BPA), against the General Services Administration’s (GSA) Multiple Award Schedule contracts. A list of eligible ordering activities is available at (click “For Customers Ordering from Schedules” and then “Eligibility to Use GSA Sources”). “Multiple Award Schedule (MAS)” means contracts awarded by GSA or the Department of Veterans Affairs (VA) for similar or comparable supplies, or services, established with more than one supplier, at varying prices. The primary statutory authorities for the MAS program are Title III of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 251, et seq.) and Title 40 U.S.C. 501, Services for Executive Agencies. “Requiring agency” means the agency needing the supplies or services. “Schedules e-Library” means the on-line source for GSA and VA Federal Supply Schedule contract award information. Schedules e-Library may be accessed at “Special Item Number (SIN)” means a group of generically similar (but not identical) supplies or services that are intended to serve the same general purpose or function. 8.402 General. (a) The Federal Supply Schedule program is also known as the GSA Schedules Program or the Multiple Award Schedule Program. The Federal Supply Schedule program is directed and managed by GSA and provides Federal agencies (see 8.002) with a simplified process for obtaining commercial supplies and services at prices associated with volume buying. Indefinite delivery contracts are awarded to provide supplies and services at stated prices for given periods of time. GSA may delegate certain responsibilities to other agencies (e.g., GSA has delegated authority to the VA to procure medical supplies under the VA Federal Supply Schedules program). Orders issued under the VA Federal Supply Schedule program are covered by this subpart. Additionally, the Department of Defense (DoD) manages similar systems of schedule-type contracting for military items; however, DoD systems are not covered by this subpart. (b) GSA schedule contracts require all schedule contractors to publish an “Authorized Federal Supply Schedule Pricelist” (pricelist). The pricelist contains all supplies and services offered by a schedule contractor. In addition, each pricelist contains the pricing and the terms and conditions pertaining to each Special Item Number that is on schedule. The schedule contractor is required to provide one copy of its pricelist to any ordering activity upon request. Also, a copy of the pricelist may be obtained from the Federal Supply Service by submitting a written request to or by telephone at This subpart, together with the pricelists, contain necessary information for placing delivery or task orders with schedule contractors. In addition, the GSA schedule contracting office issues Federal Supply Schedules publications that contain a general overview of the Federal Supply Schedule (FSS) program and address pertinent topics. Ordering activities may request copies of schedules publications by contacting the Centralized Mailing List Service through the Internet at submitting written requests to or by completing GSA Form 457, FSS Publications Mailing List Application, and mailing it to the GSA Centralized Mailing List Service (7SM), P.O. Box 6477, Fort Worth, TX Copies of GSA Form 457 may also be obtained from the above-referenced points of contact. (c)(1) GSA offers an on-line shopping service called “GSA Advantage!” through which ordering activities may place orders against Schedules. (Ordering activities may also use GSA Advantage! to place orders through GSA’s Global Supply System, a GSA wholesale supply source, formerly known as “GSA Stock” or the “Customer Supply Center.” FAR Subpart 8.4 is not applicable to orders placed through the GSA Global Supply System.) Ordering activities may access GSA Advantage! through the GSA Federal Supply Service Home Page ( or the GSA Federal Supply Schedule Home Page at (2) GSA Advantage! enables ordering activities to search specific information (i.e., national stock number, part number, common name), review delivery options, place orders directly with Schedule contractors and pay for orders using the Governmentwide commercial purchase card. (d) “e-Buy,” GSA’s electronic Request for Quotation (RFQ) system, is a part of a suite of on-line tools which complement GSA Advantage!. E-Buy allows ordering activities to post requirements, obtain quotes, and issue orders electronically. Ordering activities may access e-Buy at For more information or assistance on either GSA Advantage! or e-Buy, contact GSA at Internet address (e) For more information or assistance regarding the Federal Supply Schedule Program, review the following website: Additionally, for on-line training courses regarding the Schedules Program, review the following website: (f) For administrative convenience, an ordering activity contracting officer may add items not on the Federal Supply Schedule (also referred to as open market items) to a Federal Supply Schedule blanket purchase agreement (BPA) or an individual task or delivery order only if— (1) All applicable acquisition regulations pertaining to the purchase of the items not on the Federal Supply Schedule have been followed (e.g., publicizing (Part 5), competition requirements (Part 6), acquisition of commercial items (Part 12), contracting methods (Parts 13, 14, and 15), and small business programs (Part 19)); (2) The ordering activity contracting officer has determined the price for the items not on the Federal Supply Schedule is fair and reasonable; (3) The items are clearly labeled on the order as items not on the Federal Supply Schedule; and (4) All clauses applicable to items not on the Federal Supply Schedule are included in the order. ************************** Blanket purchase agreements (BPAs). (a)(1) Establishment. Ordering activities may establish BPAs under any schedule contract to fill repetitive needs for supplies or services. BPAs may be established with one or more schedule contractors. The number of BPAs to be established is within the discretion of the ordering activity establishing the BPAs and should be based on a strategy that is expected to maximize the effectiveness of the BPA(s). In determining how many BPAs to establish, consider— (i) The scope and complexity of the requirement(s); (ii) The need to periodically compare multiple technical approaches or prices; (iii) The administrative costs of BPAs; and (iv) The technical qualifications of the schedule contractor(s). (2) Establishment of a single BPA, or multiple BPAs, shall be made using the same procedures outlined in or BPAs shall address the frequency of ordering, invoicing, discounts, requirements (e.g. estimated quantities, work to be performed), delivery locations, and time. (3) When establishing multiple BPAs, the ordering activity shall specify the procedures for placing orders under the BPAs. (4) Establishment of a multi-agency BPA against a Federal Supply Schedule contract is permitted if the multi-agency BPA identifies the participating agencies and their estimated requirements at the time the BPA is established. (b) Ordering from BPAs— (1) Single BPA. If the ordering activity establishes one BPA, authorized users may place the order directly under the established BPA when the need for the supply or service arises. (2) Multiple BPAs. If the ordering activity establishes multiple BPAs, before placing an order exceeding the micro-purchase threshold, the ordering activity shall— (i) Forward the requirement, or statement of work and the evaluation criteria, to an appropriate number of BPA holders, as established in the BPA ordering procedures; and (ii) Evaluate the responses received, make a best value determination (see 8.404(d)), and place the order with the BPA holder that represents the best value. (3) BPAs for hourly rate services. If the BPA is for hourly rate services, the ordering activity shall develop a statement of work for requirements covered by the BPA. All orders under the BPA shall specify a price for the performance of the tasks identified in the statement of work. (c) Duration of BPAs. BPAs generally should not exceed five years in length, but may do so to meet program requirements. Contractors may be awarded BPAs that extend beyond the current term of their GSA Schedule contract, so long as there are option periods in their GSA Schedule contract that, if exercised, will cover the BPA’s period of performance. (d) Review of BPAs. (1) The ordering activity that established the BPA shall review it at least once a year to determine whether— (i) The schedule contract, upon which the BPA was established, is still in effect; (ii) The BPA still represents the best value (see 8.404(d)); and (iii) Estimated quantities/amounts have been exceeded and additional price reductions can be obtained. (2) The ordering activity shall document the results of its review.

8.402 Federal Supply Schedules
(a) The Federal Supply Schedule program is also known as the GSA Schedules Program or the Multiple Award Schedule Program. The Federal Supply Schedule program is directed and managed by GSA and provides Federal agencies (see 8.002) with a simplified process for obtaining commercial supplies and services at prices associated with volume buying. Indefinite delivery contracts are awarded to provide supplies and services at stated prices for given periods of time. GSA may delegate certain responsibilities to other agencies (e.g., GSA has delegated authority to the VA to procure medical supplies under the VA Federal Supply Schedules program). SLIDE 20 Subpart 8.4—Federal Supply Schedules 8.401 Definitions. As used in this subpart— “Ordering activity” means an activity that is authorized to place orders, or establish blanket purchase agreements (BPA), against the General Services Administration’s (GSA) Multiple Award Schedule contracts. A list of eligible ordering activities is available at (click “For Customers Ordering from Schedules” and then “Eligibility to Use GSA Sources”). “Multiple Award Schedule (MAS)” means contracts awarded by GSA or the Department of Veterans Affairs (VA) for similar or comparable supplies, or services, established with more than one supplier, at varying prices. The primary statutory authorities for the MAS program are Title III of the Federal Property and Administrative Services Act of 1949 (41 U.S.C. 251, et seq.) and Title 40 U.S.C. 501, Services for Executive Agencies. “Requiring agency” means the agency needing the supplies or services. “Schedules e-Library” means the on-line source for GSA and VA Federal Supply Schedule contract award information. Schedules e-Library may be accessed at “Special Item Number (SIN)” means a group of generically similar (but not identical) supplies or services that are intended to serve the same general purpose or function. 8.402 General. (a) The Federal Supply Schedule program is also known as the GSA Schedules Program or the Multiple Award Schedule Program. The Federal Supply Schedule program is directed and managed by GSA and provides Federal agencies (see 8.002) with a simplified process for obtaining commercial supplies and services at prices associated with volume buying. Indefinite delivery contracts are awarded to provide supplies and services at stated prices for given periods of time. GSA may delegate certain responsibilities to other agencies (e.g., GSA has delegated authority to the VA to procure medical supplies under the VA Federal Supply Schedules program). Orders issued under the VA Federal Supply Schedule program are covered by this subpart. Additionally, the Department of Defense (DoD) manages similar systems of schedule-type contracting for military items; however, DoD systems are not covered by this subpart. (b) GSA schedule contracts require all schedule contractors to publish an “Authorized Federal Supply Schedule Pricelist” (pricelist). The pricelist contains all supplies and services offered by a schedule contractor. In addition, each pricelist contains the pricing and the terms and conditions pertaining to each Special Item Number that is on schedule. The schedule contractor is required to provide one copy of its pricelist to any ordering activity upon request. Also, a copy of the pricelist may be obtained from the Federal Supply Service by submitting a written request to or by telephone at This subpart, together with the pricelists, contain necessary information for placing delivery or task orders with schedule contractors. In addition, the GSA schedule contracting office issues Federal Supply Schedules publications that contain a general overview of the Federal Supply Schedule (FSS) program and address pertinent topics. Ordering activities may request copies of schedules publications by contacting the Centralized Mailing List Service through the Internet at submitting written requests to or by completing GSA Form 457, FSS Publications Mailing List Application, and mailing it to the GSA Centralized Mailing List Service (7SM), P.O. Box 6477, Fort Worth, TX Copies of GSA Form 457 may also be obtained from the above-referenced points of contact. (c)(1) GSA offers an on-line shopping service called “GSA Advantage!” through which ordering activities may place orders against Schedules. (Ordering activities may also use GSA Advantage! to place orders through GSA’s Global Supply System, a GSA wholesale supply source, formerly known as “GSA Stock” or the “Customer Supply Center.” FAR Subpart 8.4 is not applicable to orders placed through the GSA Global Supply System.) Ordering activities may access GSA Advantage! through the GSA Federal Supply Service Home Page ( or the GSA Federal Supply Schedule Home Page at (2) GSA Advantage! enables ordering activities to search specific information (i.e., national stock number, part number, common name), review delivery options, place orders directly with Schedule contractors (except see ) and pay for orders using the Governmentwide commercial purchase card. (d) “e-Buy,” GSA’s electronic Request for Quotation (RFQ) system, is a part of a suite of on-line tools which complement GSA Advantage!. E-Buy allows ordering activities to post requirements, obtain quotes, and issue orders electronically. Ordering activities shall post an RFQ to e-Buy when an order contains brand name specifications (see ). Ordering activities may access e-Buy at For more information or assistance on either GSA Advantage! or e-Buy, contact GSA at Internet address (e) For more information or assistance regarding the Federal Supply Schedule Program, review the following website: Additionally, for on-line training courses regarding the Schedules Program, review the following website: (f) For administrative convenience, an ordering activity contracting officer may add items not on the Federal Supply Schedule (also referred to as open market items) to a Federal Supply Schedule blanket purchase agreement (BPA) or an individual task or delivery order only if— (1) All applicable acquisition regulations pertaining to the purchase of the items not on the Federal Supply Schedule have been followed (e.g., publicizing (Part 5), competition requirements (Part 6), acquisition of commercial items (Part 12), contracting methods (Parts 13, 14, and 15), and small business programs (Part 19)); (2) The ordering activity contracting officer has determined the price for the items not on the Federal Supply Schedule is fair and reasonable; (3) The items are clearly labeled on the order as items not on the Federal Supply Schedule; and (4) All clauses applicable to items not on the Federal Supply Schedule are included in the order. (g) When using the Governmentwide commercial purchase card as a method of payment, orders at or below the micro-purchase threshold are exempt from verification in the Central Contractor Registration (CCR) database as to whether the contractor has a delinquent debt subject to collection under the Treasury Offset Program (TOP).

8.402 Federal Supply Schedules
(b) GSA schedule contracts require all schedule contractors to publish an “Authorized Federal Supply Schedule Pricelist” (pricelist). The pricelist contains all supplies and services offered by a schedule contractor. In addition, each pricelist contains the pricing and the terms and conditions pertaining to each Special Item Number that is on schedule. The schedule contractor is required to provide one copy of its pricelist to any ordering activity upon request. SLIDE 21 (This is the only link I can not make work. The address is correct but you have to put it in every time.) (b) GSA schedule contracts require all schedule contractors to publish an “Authorized Federal Supply Schedule Pricelist” (pricelist). The pricelist contains all supplies and services offered by a schedule contractor. In addition, each pricelist contains the pricing and the terms and conditions pertaining to each Special Item Number that is on schedule. The schedule contractor is required to provide one copy of its pricelist to any ordering activity upon request. Also, a copy of the pricelist may be obtained from the Federal Supply Service by submitting a written request to or by telephone at This subpart, together with the pricelists, contain necessary information for placing delivery or task orders with schedule contractors. In addition, the GSA schedule contracting office issues Federal Supply Schedules publications that contain a general overview of the Federal Supply Schedule (FSS) program and address pertinent topics. Ordering activities may request copies of schedules publications by contacting the Centralized Mailing List Service through the Internet at submitting written requests to or by completing GSA Form 457, FSS Publications Mailing List Application, and mailing it to the GSA Centralized Mailing List Service (7SM), P.O. Box 6477, Fort Worth, TX Copies of GSA Form 457 may also be obtained from the above-referenced points of contact.

8.405-1 Ordering procedures for supplies, and services not requiring a statement of work.
Ordering activities shall use the procedures of this subsection when ordering supplies and services that are listed in the schedules contracts at a fixed price for the performance of a specific task, where a statement of work is not required (e.g., installation, maintenance, and repair). (b) Orders at or below the micro-purchase threshold. Ordering activities may place orders at, or below, the micro-purchase threshold with any Federal Supply Schedule contractor that can meet the agency’s needs. Although not required to solicit from a specific number of schedule contractors, ordering activities should attempt to distribute orders among contractors. (c) Orders exceeding the micro-purchase threshold but not exceeding the maximum order threshold. SLIDE 22 (c) Orders exceeding the micro-purchase threshold but not exceeding the maximum order threshold. (1) Ordering activities shall place orders with the schedule contractor that can provide the supply or service that represents the best value. Before placing an order, an ordering activity shall consider reasonably available information about the supply or service offered under MAS contracts by surveying at least three schedule contractors through the GSA Advantage! on-line shopping service, or by reviewing the catalogs or pricelists of at least three schedule contractors (see ). (2) When an order contains brand name specifications, the contracting officer shall post the Request for Quote (RFQ) along with the justification or documentation as required by (3) In addition to price, when determining best value, the ordering activity may consider, among other factors, the following: (i) Past performance. (ii) Special features of the supply or service required for effective program performance. (iii) Trade-in considerations. (iv) Probable life of the item selected as compared with that of a comparable item. (v) Warranty considerations. (vi) Maintenance availability. (vii) Environmental and energy efficiency considerations. (viii) Delivery terms. (d) Orders exceeding the maximum order threshold. Each schedule contract has a maximum order threshold established on a SIN-by-SIN basis. Although a price reduction may be sought at any time, this threshold represents the point where, given the dollar value of the potential order, the ordering activity shall seek a price reduction. In addition to following the procedures in paragraph (c) of this section and before placing an order that exceeds the maximum order threshold or establishing a BPA (see ), ordering activities shall— (1) Review (except see (c)(2) of this subsection) the pricelists of additional schedule contractors (the GSA Advantage! on-line shopping service can be used to facilitate this review); (2) Based upon the initial evaluation, seek price reductions from the schedule contractor(s) considered to offer the best value (see 8.404(d)); and (3) After seeking price reductions (see ), place the order with the schedule contractor that provides the best value. If further price reductions are not offered, an order may still be placed. (e) Minimum documentation. The ordering activity shall document— (1) The schedule contracts considered, noting the contractor from which the supply or service was purchased; (2) A description of the supply or service purchased; and (3) The amount paid.

8.405-2 Ordering procedures for services requiring a statement of work.
General. Ordering activities shall use the procedures in this subsection when ordering services priced at hourly rates as established by the schedule contracts. The applicable services will be identified in the Federal Supply Schedule publications and the contractor’s pricelists. (b) Statements of Work (SOWs). All Statements of Work shall include the work to be performed; location of work; period of performance; deliverable schedule; applicable performance standards; and any special requirements (e.g., security clearances, travel, special knowledge). To the maximum extent practicable, agency requirements shall be performance-based statements (see Subpart 37.6). (c) Request for Quotation procedures. The ordering activity must provide the Request for Quotation (RFQ), which includes the statement of work and evaluation criteria (e.g., experience and past performance), to schedule contractors that offer services that will meet the agency’s needs. The RFQ may be posted to GSA’s electronic RFQ system, e-Buy (see 8.402(d)). SLIDE 23 (c) Request for Quotation procedures. The ordering activity must provide the Request for Quotation (RFQ), which includes the statement of work and evaluation criteria (e.g., experience and past performance), to schedule contractors that offer services that will meet the agency’s needs. The RFQ may be posted to GSA’s electronic RFQ system, e-Buy (see 8.402(d)). (1) Orders at, or below, the micro-purchase threshold. Ordering activities may place orders at, or below, the micro-purchase threshold with any Federal Supply Schedule contractor that can meet the agency’s needs. The ordering activity should attempt to distribute orders among contractors. (2) For orders exceeding the micro-purchase thres-hold, but not exceeding the maximum order threshold. (i) The ordering activity shall develop a statement of work, in accordance with (b). (ii) The ordering activity shall provide the RFQ (including the statement of work and evaluation criteria) to at least three schedule contractors that offer services that will meet the agency’s needs. (iii) The ordering activity should request that contractors submit firm-fixed prices to perform the services identified in the statement of work. (3) For proposed orders exceeding the maximum order threshold or when establishing a BPA. In addition to meeting the requirements of (c)(2), the ordering activity shall— (i) Provide the RFQ (including the statement of work and evaluation criteria) to additional schedule contractors that offer services that will meet the needs of the ordering activity. When determining the appropriate number of additional schedule contractors, the ordering activity may consider, among other factors, the following: (A) The complexity, scope and estimated value of the requirement. (B) The market search results. (ii) Seek price reductions. (4) The ordering activity shall provide the RFQ (including the statement of work and the evaluation criteria) to any schedule contractor who requests a copy of it. (d) Evaluation. The ordering activity shall evaluate all responses received using the evaluation criteria provided to the schedule contractors. The ordering activity is responsible for considering the level of effort and the mix of labor proposed to perform a specific task being ordered, and for determining that the total price is reasonable. Place the order, or establish the BPA, with the schedule contractor that represents the best value (see 8.404(d)). After award, ordering activities should provide timely notification to unsuccessful offerors. If an unsuccessful offeror requests information on an award that was based on factors other than price alone, a brief explanation of the basis for the award decision shall be provided. (e) Minimum documentation. The ordering activity shall document— (1) The schedule contracts considered, noting the contractor from which the service was purchased; (2) A description of the service purchased; (3) The amount paid; (4) The evaluation methodology used in selecting the contractor to receive the order; (5) The rationale for any tradeoffs in making the selection; (6) The price reasonableness determination required by paragraph (d) of this subsection; and (7) The rationale for using other than— (i) A firm-fixed price order; or (ii) A performance-based order.

Required Suppliers 8.6—Acquisition from Federal Prison Industries, Inc. 8.7—Acquisition from Nonprofit Agencies Employing People Who Are Blind or Severely Disabled 8.8—Acquisition of Printing and Related Supplies SLIDE 24 8.602 Policy. (a) In accordance with 10 U.S.C. 2410n and Section 637 of Division H of the Consolidated Appropriations Act, 2005 (Pub. L ), and except as provided in paragraph (b) of this section, agencies shall— (1) Before purchasing an item of supply listed in the FPI Schedule, conduct market research to determine whether the FPI item is comparable to supplies available from the private sector that best meet the Government’s needs in terms of price, quality, and time of delivery. This is a unilateral determination made at the discretion of the contracting officer. The arbitration provisions of 18 U.S.C. 4124(b) do not apply. (2) Prepare a written determination that includes supporting rationale explaining the assessment of price, quality, and time of delivery, based on the results of market research comparing the FPI item to supplies available from the private sector. (3) If the FPI item is comparable, purchase the item from FPI following the ordering procedures at unless a waiver is obtained in accordance with (4) If the FPI item is not comparable in one or more of the areas of price, quality, and time of delivery— (i) Acquire the item using— (A) Competitive procedures (e.g., the procedures in 6.102, the set-aside procedures in Subpart 19.5, or competition conducted in accordance with Part 13); or (B) The fair opportunity procedures in , if placing an order under a multiple award delivery-order contract; (ii) Include FPI in the solicitation process and consider a timely offer from FPI for award in accordance with the item description or specifications, and evaluation factors in the solicitation— (A) If the solicitation is available through the Governmentwide point of entry (FedBizOpps), it is not necessary to provide a separate copy of the solicitation to FPI; (B) If the solicitation is not available through FedBizOpps, provide a copy of the solicitation to FPI; (iii) When using a multiple award schedule issued under the procedures in Subpart 8.4 or when using the fair opportunity procedures in — (A) Establish and communicate to FPI the item description or specifications, and evaluation factors that will be used as the basis for selecting a source, so that an offer from FPI can be evaluated on the same basis as the contract or schedule holder; and (B) Consider a timely offer from FPI; (iv) Award to the source offering the item determined by the agency to provide the best value to the Government; and (v) When the FPI item is determined to provide the best value to the Government as a result of FPI’s response to a competitive solicitation, follow the ordering procedures at

8.405-6 Limited sources justification and approval.
Orders placed under Federal Supply Schedules are exempt from the requirements in Part 6. However, an ordering activity must justify its action when restricting consideration— (h) Justification approvals. (1) For proposed orders exceeding the simplified acquisition threshold, but not exceeding $550,000, the ordering activity contracting officer’s certification that the justification is accurate and complete to the best of the ordering activity contracting officer’s knowledge and belief will serve as approval, unless a higher approval level is established in accordance with agency procedures. (2) For a proposed order exceeding $550,000, but not exceeding $11.5 million, the justification must be approved by the competition advocate of the activity placing the order, or by an official named in paragraph (h)(3) or (h)(4) of this subsection. This authority is not delegable. (3) For a proposed order exceeding $11.5 million, but not exceeding $57 million (or, for DoD, NASA, and the Coast Guard, not exceeding $78.5 million), the justification must be approved by— SLIDE 25 (h) Justification approvals. (1) For proposed orders exceeding the simplified acquisition threshold, but not exceeding $550,000, the ordering activity contracting officer’s certification that the justification is accurate and complete to the best of the ordering activity contracting officer’s knowledge and belief will serve as approval, unless a higher approval level is established in accordance with agency procedures. (2) For a proposed order exceeding $550,000, but not exceeding $11.5 million, the justification must be approved by the competition advocate of the activity placing the order, or by an official named in paragraph (h)(3) or (h)(4) of this subsection. This authority is not delegable. (3) For a proposed order exceeding $11.5 million, but not exceeding $57 million (or, for DoD, NASA, and the Coast Guard, not exceeding $78.5 million), the justification must be approved by— (i) The head of the procuring activity placing the order; (ii) A designee who— (A) If a member of the armed forces, is a general or flag officer; (B) If a civilian, is serving in a position in a grade above GS-15 under the General Schedule (or in a comparable or higher position under another schedule); or (iii) An official named in paragraph (h)(4) of this subsection.

Part 9 – Contractor Qualifications
9.1 Responsible Prospective Contractors 9.2 Qualifications Requirements 9.3 First Article Testing and Approval 9.4 Debarment, Suspension, and Ineligibility 9.5 Organizational and Consultant Conflicts of Interest 9.6 Contractor Team Arrangements 9.7 Defense Production Pools and Research and Developmental Pools SLIDE 26

9.103 Policy (a) Purchases shall be made from, and contracts shall be awarded to, responsible prospective contractors only. (b) No purchase or award shall be made unless the contracting officer makes an affirmative determination of responsibility. In the absence of information clearly indicating that the prospective contractor is responsible, the contracting officer shall make a determination of nonresponsibility. If the prospective contractor is a small business concern, the contracting officer shall comply with Subpart 19.6, Certificates of Competency and Determinations of Responsibility. (If Section 8(a) of the Small Business Act (15 U.S.C. 637) applies, see Subpart 19.8.) (c) The award of a contract to a supplier based on lowest evaluated price alone can be false economy if there is subsequent default, late deliveries, or other unsatisfactory performance resulting in additional contractual or administrative costs. While it is important that Government purchases be made at the lowest price, this does not require an award to a supplier solely because that supplier submits the lowest offer. A prospective contractor must affirmatively demonstrate its responsibility, including, when necessary, the responsibility of its proposed subcontractors. SLIDE 27 9.103 Policy. (a) Purchases shall be made from, and contracts shall be awarded to, responsible prospective contractors only. (b) No purchase or award shall be made unless the contracting officer makes an affirmative determination of responsibility. In the absence of information clearly indicating that the prospective contractor is responsible, the contracting officer shall make a determination of nonresponsibility. If the prospective contractor is a small business concern, the contracting officer shall comply with Subpart 19.6, Certificates of Competency and Determinations of Responsibility. (If Section 8(a) of the Small Business Act (15 U.S.C. 637) applies, see Subpart 19.8.) (c) The award of a contract to a supplier based on lowest evaluated price alone can be false economy if there is subsequent default, late deliveries, or other unsatisfactory performance resulting in additional contractual or administrative costs. While it is important that Government purchases be made at the lowest price, this does not require an award to a supplier solely because that supplier submits the lowest offer. A prospective contractor must affirmatively demonstrate its responsibility, including, when necessary, the responsibility of its proposed subcontractors.

General Standards To be determined responsible, a prospective contractor must— Have adequate financial resources to perform the contract, or the ability to obtain them (see (a)); (b) Be able to comply with the required or proposed delivery or performance schedule, taking into consideration all existing commercial and governmental business commitments; (c) Have a satisfactory performance record (see (b) and Subpart 42.15). A prospective contractor shall not be determined responsible or nonresponsible solely on the basis of a lack of relevant performance history, except as provided in ; (d) Have a satisfactory record of integrity and business ethics (for example, see Subpart 42.15). SLIDE 28 9.104 Standards. General standards. To be determined responsible, a prospective contractor must— (a) Have adequate financial resources to perform the contract, or the ability to obtain them (see (a)); (b) Be able to comply with the required or proposed delivery or performance schedule, taking into consideration all existing commercial and governmental business commitments; (c) Have a satisfactory performance record (see (b) and Subpart 42.15). A prospective contractor shall not be determined responsible or nonresponsible solely on the basis of a lack of relevant performance history, except as provided in ; (d) Have a satisfactory record of integrity and business ethics (for example, see Subpart 42.15). (e) Have the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them (including, as appropriate, such elements as production control procedures, property control systems, quality assurance measures, and safety programs applicable to materials to be produced or services to be performed by the prospective contractor and subcontractors). (See (a).) (f) Have the necessary production, construction, and technical equipment and facilities, or the ability to obtain them (see (a)); and (g) Be otherwise qualified and eligible to receive an award under applicable laws and regulations (see also inverted domestic corporation prohibition at FAR 9.108). Special standards. (a) When it is necessary for a particular acquisition or class of acquisitions, the contracting officer shall develop, with the assistance of appropriate specialists, special standards of responsibility. Special standards may be particularly desirable when experience has demonstrated that unusual expertise or specialized facilities are needed for adequate contract performance. The special standards shall be set forth in the solicitation (and so identified) and shall apply to all offerors. (b) Contracting officers shall award contracts for subsistence only to those prospective contractors that meet the general standards in and are approved in accordance with agency sanitation standards and procedures.

General Standards (e) Have the necessary organization, experience, accounting and operational controls, and technical skills, or the ability to obtain them (including, as appropriate, such elements as production control procedures, property control systems, quality assurance measures, and safety programs applicable to materials to be produced or services to be performed by the prospective contractor and subcontractors). (See (a).) (f) Have the necessary production, construction, and technical equipment and facilities, or the ability to obtain them (see (a)); and (g) Be otherwise qualified and eligible to receive an award under applicable laws and regulations (see also inverted domestic corporation prohibition at FAR 9.108). SLIDE 29

9.104-3 Application of standards.
Ability to obtain resources. Except to the extent that a prospective contractor has sufficient resources or proposes to perform the contract by subcontracting, the contracting officer shall require acceptable evidence of the prospective contractor’s ability to obtain required resources (see (a), (e), and (f)). (b) Satisfactory performance record. A prospective contractor that is or recently has been seriously deficient in contract performance shall be presumed to be nonresponsible, unless the contracting officer determines that the circumstances were properly beyond the contractor’s control, or that the contractor has taken appropriate corrective action. (c) Affiliated concerns. (d) Small business concerns. SLIDE 30 Application of standards. (a) Ability to obtain resources. Except to the extent that a prospective contractor has sufficient resources or proposes to perform the contract by subcontracting, the contracting officer shall require acceptable evidence of the prospective contractor’s ability to obtain required resources (see (a), (e), and (f)). Acceptable evidence normally consists of a commitment or explicit arrangement, that will be in existence at the time of contract award, to rent, purchase, or otherwise acquire the needed facilities, equipment, other resources, or personnel. Consideration of a prime contractor’s compliance with limitations on subcontracting shall take into account the time period covered by the contract base period or quantities plus option periods or quantities, if such options are considered when evaluating offers for award. (b) Satisfactory performance record. A prospective contractor that is or recently has been seriously deficient in contract performance shall be presumed to be nonresponsible, unless the contracting officer determines that the circumstances were properly beyond the contractor’s control, or that the contractor has taken appropriate corrective action. Past failure to apply sufficient tenacity and perseverance to perform acceptably is strong evidence of nonresponsibility. Failure to meet the quality requirements of the contract is a significant factor to consider in determining satisfactory performance. The contracting officer shall consider the number of contracts involved and the extent of deficient performance in each contract when making this determination. If the pending contract requires a subcontracting plan pursuant to Subpart 19.7, The Small Business Subcontracting Program, the contracting officer shall also consider the prospective contractor’s compliance with subcontracting plans under recent contracts. (c) Affiliated concerns. Affiliated concerns (see “Concern” in and “Affiliates” in 19.101) are normally considered separate entities in determining whether the concern that is to perform the contract meets the applicable standards for responsibility. However, the contracting officer shall consider the affiliate’s past performance and integrity when they may adversely affect the prospective contractor’s responsibility. (d) Small business concerns. (1) If a small business concern’s offer that would otherwise be accepted is to be rejected because of a determination of nonresponsibility, the contracting officer shall refer the matter to the Small Business Administration, which will decide whether or not to issue a Certificate of Competency (see Subpart 19.6). (2) A small business that is unable to comply with the limitations on subcontracting at may be considered nonresponsible.

Federal Acquisition Regulation Subchapter C—Contracting Methods and Contract Types
SLIDE 10 CDC PGO Feb-Mar, 2010

Contract Methodologies
Unsolicited Proposal Point-of-Sale Transactions Master Agreements Sales Contract Framework Pricing Arrangement Performance-Based Contract Single Source Negotiation Prequalification Sealed Bidding Two-step Sealed Bidding Negotiation Simplified Acquisition Modular Contracting Auctions Request for Quotation Request for Information SLIDE 32 Hand out the matching test (definitions to terms) Have class partner with the person on their right Give them 10 minutes to match the descriptors to the terms Scoring: Method 1 – you give them the answers Method 2 – you ask for a confident pair who will read off answers until they miss one and then go to the next pair. Note: Make the prizes very small and give them to each pair with 100% correct answers. Look at quiz to see the other “prizes.” Reward: Give all pairs with 95% or above a valentine candy???

Part 16—Types of Contracts
16.1 Selecting Contract Types 16.2 Fixed-Price Contracts 16.3 Cost-Reimbursement Contracts 16.4 Incentive Contracts 16.5 Indefinite-Delivery Contracts 16.6 Time-and-Materials, Labor-Hour, and Letter Contracts 16.7 Agreements

Contract types vary according to—
(1) The degree and timing of the responsibility assumed by the contractor for the costs of performance; and (2) The amount and nature of the profit incentive offered to the contractor for achieving or exceeding specified standards or goals. (b) The contract types are grouped into two broad categories: fixed-price contracts (see Subpart 16.2) and cost-reimbursement contracts (see Subpart 16.3). The specific contract types range from firm-fixed-price, in which the contractor has full responsibility for the performance costs and resulting profit (or loss), to cost-plus-fixed-fee, in which the contractor has minimal responsibility for the performance costs and the negotiated fee (profit) is fixed. In between are the various incentive contracts SLIDE 34

16.104 Factors in selecting contract types.
Price Competition Price Analysis Cost Analysis Type and complexity of the requirement Urgency Period of Performance Contractor’s technical capability and financial responsibility Adequacy of the contractor’s accounting system Concurrent contracts Extent and nature of proposed subcontracting Acquisition history SLIDE 35 16.104 Factors in selecting contract types. There are many factors that the contracting officer should consider in selecting and negotiating the contract type. They include the following: (a) Price competition. Normally, effective price competition results in realistic pricing, and a fixed-price contract is ordinarily in the Government’s interest. (b) Price analysis. Price analysis, with or without competition, may provide a basis for selecting the contract type. The degree to which price analysis can provide a realistic pricing standard should be carefully considered. (See (b).) (c) Cost analysis. In the absence of effective price competition and if price analysis is not sufficient, the cost estimates of the offeror and the Government provide the bases for negotiating contract pricing arrangements. It is essential that the uncertainties involved in performance and their possible impact upon costs be identified and evaluated, so that a contract type that places a reasonable degree of cost responsibility upon the contractor can be negotiated. (d) Type and complexity of the requirement. Complex requirements, particularly those unique to the Government, usually result in greater risk assumption by the Government. This is especially true for complex research and development contracts, when performance uncertainties or the likelihood of changes makes it difficult to estimate performance costs in advance. As a requirement recurs or as quantity production begins, the cost risk should shift to the contractor, and a fixed-price contract should be considered. (e) Urgency of the requirement. If urgency is a primary factor, the Government may choose to assume a greater proportion of risk or it may offer incentives to ensure timely contract performance. (f) Period of performance or length of production run. In times of economic uncertainty, contracts extending over a relatively long period may require economic price adjustment terms. (g) Contractor’s technical capability and financial responsibility. (h) Adequacy of the contractor’s accounting system. Before agreeing on a contract type other than firm-fixed-price, the contracting officer shall ensure that the contractor’s accounting system will permit timely development of all necessary cost data in the form required by the proposed contract type. This factor may be critical when the contract type requires price revision while performance is in progress, or when a cost-reimbursement contract is being considered and all current or past experience with the contractor has been on a fixed-price basis. (i) Concurrent contracts. If performance under the proposed contract involves concurrent operations under other contracts, the impact of those contracts, including their pricing arrangements, should be considered. (j) Extent and nature of proposed subcontracting. If the contractor proposes extensive subcontracting, a contract type reflecting the actual risks to the prime contractor should be selected. (k) Acquisition history. Contractor risk usually decreases as the requirement is repetitively acquired. Also, product descriptions or descriptions of services to be performed can be defined more clearly.

16.2 Fixed-Price Contracts 16.202 Firm-fixed-price contracts.
Description. A firm-fixed-price contract provides for a price that is not subject to any adjustment on the basis of the contractor’s cost experience in performing the contract. This contract type places upon the contractor maximum risk and full responsibility for all costs and resulting profit or loss. It provides maximum incentive for the contractor to control costs and perform effectively and imposes a minimum administrative burden upon the contracting parties.

Application. A firm-fixed-price contract is suitable for acquiring commercial items (see Parts 2 and 12) or for acquiring other supplies or services on the basis of reasonably definite functional or detailed specifications (see Part 11) when the contracting officer can establish fair and reasonable prices at the outset, such as when— (a) There is adequate price competition; (b) There are reasonable price comparisons with prior purchases of the same or similar supplies or services made on a competitive basis or supported by valid cost or pricing data; (c) Available cost or pricing information permits realistic estimates of the probable costs of performance; or (d) Performance uncertainties can be identified and reasonable estimates of their cost impact can be made, and the contractor is willing to accept a firm fixed price representing assumption of the risks involved. SLIDE 37 Application. A firm-fixed-price contract is suitable for acquiring commercial items (see Parts 2 and 12) or for acquiring other supplies or services on the basis of reasonably definite functional or detailed specifications (see Part 11) when the contracting officer can establish fair and reasonable prices at the outset, such as when— (a) There is adequate price competition; (b) There are reasonable price comparisons with prior purchases of the same or similar supplies or services made on a competitive basis or supported by valid cost or pricing data; (c) Available cost or pricing information permits realistic estimates of the probable costs of performance; or (d) Performance uncertainties can be identified and reasonable estimates of their cost impact can be made, and the contractor is willing to accept a firm fixed price representing assumption of the risks involved.

Cost Reimbursement Type -- 16.301-1 Description.
Cost-reimbursement types of contracts provide for payment of allowable incurred costs, to the extent prescribed in the contract. These contracts establish an estimate of total cost for the purpose of obligating funds and establishing a ceiling that the contractor may not exceed (except at its own risk) without the approval of the contracting officer. Application. Cost-reimbursement contracts are suitable for use only when uncertainties involved in contract performance do not permit costs to be estimated with sufficient accuracy to use any type of fixed-price contract. Limitations. (a) A cost-reimbursement contract may be used only when— (1) The contractor’s accounting system is adequate for determining costs applicable to the contract; and (2) Appropriate Government surveillance during performance will provide reasonable assurance that efficient methods and effective cost controls are used. (b) The use of cost-reimbursement contracts is prohibited for the acquisition of commercial items (see Parts 2 and 12).

Cost Reimbursement Type --
Application. Cost-reimbursement contracts are suitable for use only when uncertainties involved in contract performance do not permit costs to be estimated with sufficient accuracy to use any type of fixed-price contract. Limitations. (a) A cost-reimbursement contract may be used only when— (1) The contractor’s accounting system is adequate for determining costs applicable to the contract; and (2) Appropriate Government surveillance during performance will provide reasonable assurance that efficient methods and effective cost controls are used. (b) The use of cost-reimbursement contracts is prohibited for the acquisition of commercial items (see Parts 2 and 12). SLIDE 39 Application. Cost-reimbursement contracts are suitable for use only when uncertainties involved in contract performance do not permit costs to be estimated with sufficient accuracy to use any type of fixed-price contract. Limitations. (a) A cost-reimbursement contract may be used only when— (1) The contractor’s accounting system is adequate for determining costs applicable to the contract; and (2) Appropriate Government surveillance during performance will provide reasonable assurance that efficient methods and effective cost controls are used. (b) The use of cost-reimbursement contracts is prohibited for the acquisition of commercial items (see Parts 2 and 12).

16.5 Indefinite-Delivery Contracts 16.501-2 General.
There are three types of indefinite-delivery contracts: definite-quantity contracts, requirements contracts, and indefinite-quantity contracts. The appropriate type of indefinite-delivery contract may be used to acquire supplies and/or services when the exact times and/or exact quantities of future deliveries are not known at the time of contract award. Pursuant to 10 U.S.C. 2304d and section 303K of the Federal Property and Administrative Services Act of 1949, requirements contracts and indefinite-quantity contracts are also known as delivery order contracts or task order contracts. SLIDE 40 (a) Description. An indefinite-quantity contract provides for an indefinite quantity, within stated limits, of supplies or services during a fixed period. The Government places orders for individual requirements. Quantity limits may be stated as number of units or as dollar values. (1) The contract must require the Government to order and the contractor to furnish at least a stated minimum quantity of supplies or services. In addition, if ordered, the contractor must furnish any additional quantities, not to exceed the stated maximum. The contracting officer should establish a reasonable maximum quantity based on market research, trends on recent contracts for similar supplies or services, survey of potential users, or any other rational basis. (2) To ensure that the contract is binding, the minimum quantity must be more than a nominal quantity, but it should not exceed the amount that the Government is fairly certain to order. (3) The contract may also specify maximum or minimum quantities that the Government may order under each task or delivery order and the maximum that it may order during a specific period of time. (4) A solicitation and contract for an indefinite quantity must—

16.601 Time-and-materials contracts.
(a) Description. A time-and-materials contract provides for acquiring supplies or services on the basis of— (1) Direct labor hours at specified fixed hourly rates that include wages, overhead, general and administrative expenses, and profit; and (2) Materials at cost, including, if appropriate, material handling costs as part of material costs. SLIDE 41 (d) Limitations. A time-and-materials contract may be used only if— (1) The contracting officer prepares a determination and findings that no other contract type is suitable. The determination and finding shall be— (i) Signed by the contracting officer prior to the execution of the base period or any option periods of the contracts; and (ii) Approved by the head of the contracting activity prior to the execution of the base period when the base period plus any option periods exceeds three years; and (2) The contract includes a ceiling price that the contractor exceeds at its own risk. The contracting officer shall document the contract file to justify the reasons for and amount of any subsequent change in the ceiling price. Also see (b) for further limitations on use of Time-and-Materials or Labor Hour contracts for acquisition of commercial items.

Subpart 16.7—Agreements 16.702 Basic agreements.
(a) Description. A basic agreement is a written instrument of understanding, negotiated between an agency or contracting activity and a contractor, that (1) contains contract clauses applying to future contracts between the parties during its term and (2) contemplates separate future contracts that will incorporate by reference or attachment the required and applicable clauses agreed upon in the basic agreement. A basic agreement is not a contract. (b) Application. A basic agreement should be used when a substantial number of separate contracts may be awarded to a contractor during a particular period and significant recurring negotiating problems have been experienced with the contractor. Basic agreements may be used with negotiated fixed-price or cost-reimbursement contracts. SLIDE 42 (1) Basic agreements shall contain— (i) Clauses required for negotiated contracts by statute, executive order, and this regulation; and (ii) Other clauses prescribed in this regulation or agency acquisition regulations that the parties agree to include in each contract as applicable. (2) Each basic agreement shall provide for discontinuing its future applicability upon 30 days’ written notice by either party. (3) Each basic agreement shall be reviewed annually before the anniversary of its effective date and revised as necessary to conform to the requirements of this regulation. Basic agreements may need to be revised before the annual review due to mandatory statutory requirements. A basic agreement may be changed only by modifying the agree-ment itself and not by a contract incorporating the agreement. (4) Discontinuing or modifying a basic agreement shall not affect any prior contract incorporating the basic agreement. (5) Contracting officers of one agency should obtain and use existing basic agreements of another agency to the maximum practical extent.

(c) Limitations. A basic agreement shall not—
(1) Cite appropriations or obligate funds; (2) State or imply any agreement by the Government to place future contracts or orders with the contractor; or (3) Be used in any manner to restrict competition. SLIDE 43 (d) Contracts incorporating basic agreements. (1) Each contract incorporating a basic agreement shall include a scope of work and price, delivery, and other appropriate terms that apply to the particular contract. The basic agreement shall be incorporated into the contract by specific reference (including reference to each amendment) or by attachment. (2) The contracting officer shall include clauses pertaining to subjects not covered by the basic agreement, but applicable to the contract being negotiated, in the same manner as if there were no basic agreement. (3) If an existing contract is modified to effect new acquisition, the modification shall incorporate the most recent basic agreement, which shall apply only to work added by the modification, except that this action is not mandatory if the contract or modification includes all clauses required by statute, executive order, and this regulation as of the date of the modification. However, if it is in the Government’s interest and the contractor agrees, the modification may incorporate the most recent basic agreement for application to the entire contract as of the date of the modification.

16.703 Basic Ordering Agreements
(a) Description. A basic ordering agreement is a written instrument of understanding, negotiated between an agency, contracting activity, or contracting office and a contractor, that contains (1) terms and clauses applying to future contracts (orders) between the parties during its term, (2) a description, as specific as practicable, of supplies or services to be provided, and (3) methods for pricing, issuing, and delivering future orders under the basic ordering agreement. A basic ordering agreement is not a contract. SLIDE 44 (b) Application. A basic ordering agreement may be used to expedite contracting for uncertain requirements for supplies or services when specific items, quantities, and prices are not known at the time the agreement is executed, but a substantial number of requirements for the type of supplies or services covered by the agreement are anticipated to be purchased from the contractor. Under proper circumstances, the use of these procedures can result in economies in ordering parts for equipment support by reducing administrative lead-time, inventory investment, and inventory obsolescence due to design changes. (c) Limitations. A basic ordering agreement shall not state or imply any agreement by the Government to place future contracts or orders with the contractor or be used in any manner to restrict competition. (1) Each basic ordering agreement shall— (i) Describe the method for determining prices to be paid to the contractor for the supplies or services; (ii) Include delivery terms and conditions or specify how they will be determined; (iii) List one or more Government activities authorized to issue orders under the agreement; (iv) Specify the point at which each order becomes a binding contract (e.g., issuance of the order, acceptance of the order in a specified manner, or failure to reject the order within a specified number of days); (v) Provide that failure to reach agreement on price for any order issued before its price is established (see paragraph (d)(3) of this section) is a dispute under the Disputes clause included in the basic ordering agreement; and (vi) If fast payment procedures will apply to orders, include the special data required by (2) Each basic ordering agreement shall be reviewed annually before the anniversary of its effective date and revised as necessary to conform to the requirements of this regulation.

Part 17—Special Contracting Methods
17.1 Multi-year Contracting 17.2 Options 17.4 Leader Company Contracting 17.5 Interagency Acquisitions under the Economy Act 17.6 Management and Operating Contracts

17.1 Multi-year Contracting
(a) Multi-year contracting is a special contracting method to acquire known requirements in quantities and total cost not over planned requirements for up to 5 years unless otherwise authorized by statute, even though the total funds ultimately to be obligated may not be available at the time of contract award. This method may be used in sealed bidding or contracting by negotiation. SLIDE 46 (b) Multi-year contracting is a flexible contracting method applicable to a wide range of acquisitions. The extent to which cancellation terms are used in multi-year contracts will depend on the unique circumstances of each contract. Accordingly, for multi-year contracts, the agency head may authorize modification of the requirements of this subpart and the clause at , Cancellation Under Multi-year Contracts. (c) Agency funding of multi-year contracts shall conform to the policies in OMB Circulars A-11 (Preparation and Submission of Budget Estimates) and A-34 (Instructions on Budget Execution) and other applicable guidance regarding the funding of multi-year contracts. As provided by that guidance, the funds obligated for multi-year contracts must be sufficient to cover any potential cancellation and/or termination costs; and multi-year contracts for the acquisition of fixed assets should be fully funded or funded in stages that are economically or programmatically viable. (d) The termination for convenience procedure may apply to any Government contract, including multiyear contracts. As contrasted with cancellation, termination can be effected at any time during the life of the contract (cancellation is effected between fiscal years) and can be for the total quantity or partial quantity (where as cancellation must be for all subsequent fiscal years’ quantities).

17.5 Interagency Acquisitions under the Economy Act
17.501 Definition. “Interagency acquisition,” as used in this subpart, means a procedure by which an agency needing supplies or services (the requesting agency) obtains them from another agency (the servicing agency). SLIDE 47 17.502 General. (a) The Economy Act authorizes agencies to enter into mutual agreements to obtain supplies or services by inter-agency acquisition. (b) The Economy Act may not be used by an agency to circumvent conditions and limitations imposed on the use of funds. (c) Acquisitions under the Economy Act are not exempt from the requirements of Subpart 7.3, Contractor Versus Government Performance. (d) The Economy Act may not be used to make acquisitions conflicting with any other agency’s authority or responsibility (for example, that of the Administrator of General Services under the Federal Property and Administrative Services Act). 17.503 Determinations and findings requirements. (a) Each Economy Act order shall be supported by a Determination and Finding (D&F). The D&F shall state that— (1) Use of an interagency acquisition is in the best interest of the Government; and (2) The supplies or services cannot be obtained as conveniently or economically by contracting directly with a private source. (b) If the Economy Act order requires contract action by the servicing agency, the D&F must also include a statement that at least one of the following circumstances applies: (1) The acquisition will appropriately be made under an existing contract of the servicing agency, entered into before placement of the order, to meet the requirements of the servicing agency for the same or similar supplies or services; (2) The servicing agency has capabilities or expertise to enter into a contract for such supplies or services which is not available within the requesting agency; or (3) The servicing agency is specifically authorized by law or regulation to purchase such supplies or services on behalf of other agencies. (c) The D&F shall be approved by a contracting officer of the requesting agency with authority to contract for the supplies or services to be ordered, or by another official designated by the agency head, except that, if the servicing agency is not covered by the Federal Acquisition Regulation, approval of the D&F may not be delegated below the senior procurement executive of the requesting agency.

Federal Knowledge Module
SAMPLE TEST NCMA Federal Knowledge Module Study Guide Complete questions FAR Part 2, Questions 4-7, p FAR Part 5, Questions 11 & 12, p. 71 FAR Part 6, Questions 13-17, p FAR Part 8, Questions 18-20, p. 72 FAR Part 9, Questions 21-22, p FAR Part 16, Questions 61-64, p

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