1. 11/21/02Jack Friery 1 Homeland Security Contracting Jack Friery NCMA San Diego Chapter November 21, 2002

2. 11/21/02Jack Friery 2 Outline Department of Homeland Security—new procurement rules Contracting experiences Predictions for the future & recommendations

3. 11/21/02Jack Friery 3 Original DHS bill (HR 5005) Other transactions (five year pilot program) Personal services OK Micro-purchases <$5k SAP <$175k SAP for commercial <$7.5m (liberal definition of “commercial”) Liability limits for contractors

4. 11/21/02Jack Friery 4 House-Approved DHS Bill (HR 5710) Other transactions (five year pilot program) Personal services OK Micro-purchases <$7500 SAP <$200k ($300k overseas) SAP for commercial <$7.5m (liberal definition of “commercial”)

5. 11/21/02Jack Friery 5 Friery’s Homeland Security Contracting Experiences Process Terms & Conditions End result

6. 11/21/02Jack Friery 6 Contracting Process FAR not applicable U.S. Government issued a Request for White Papers rather than RFP Required proposal for Proof of Concept <10 pages Evaluated tech, PP, best value Very fast turnaround

7. 11/21/02Jack Friery 7 Process (con’t) Awarded four parallel cooperative agreements—Phase I Cost-sharing Very short POP

8. 11/21/02Jack Friery 8 Terms & Conditions: Going In No “best efforts” language despite a cost- sharing R&D contract U.S. Government wanted commercial source code delivered U.S. Government requested all IP become “Government property”/GPLR

9. 11/21/02Jack Friery 9 T’s & C’s: Going In Contractor indemnifies Government Indemnity of contractor not on table (U.S. Government suggested no contractor liability because U.S. Government operating system) Disputes: informal resolution only Bilateral T for C right

10. 11/21/02Jack Friery 10 T’s & C’s: the Result Best efforts language added to SOW Added ADR to disputes clause Added U.S. Government indemnity of contractor for U.S. Government acts

11. 11/21/02Jack Friery 11 T’s & C’s: the Result (con’t) Capped contractor indemnity of U.S. Government to amount of Government payment Payments clause added Two signatures required

12. 11/21/02Jack Friery 12 T’s & C’s: IP Rights Deleted IP as “Government property” Deleted GPLR references Standard AMS (FAR) IP clauses added All data “developed” under k would be delivered Agreed to negotiate license for privately- developed data

13. 11/21/02Jack Friery 13 Phase II Government directed two contractors to team to deliver prototype Selected “best” features of each tech approach Directed “joint proposal”--prime/sub relationship Twelve day turnaround for proposal FAR clauses, except Disputes

14. 11/21/02Jack Friery 14 Lessons Learned No more standard procurement system? FAR provides safeguards “Commercial” contracting can be painful Be ready/willing to negotiate T’s & C’s even in FAR contracts (FAR 12.302: contracting officer may tailor FAR-standard commercial clauses)