Contracting for CORs

1. Contracting for CORs Office of Acquisition and Logistics Management Brian Goodger, Associate Director June 19, 2014

2. Overview/Agenda • Introductions • Government Contracting Principles & Foundation • Federal Acquisition Regulation (FAR) Overview • Phases of the Acquisition Process • Phase I - Acquisition Planning • Phase II - Solicitation/Request for Proposals • Phase III - Contract Administration • Break • Simplified Acquisitions • Questions • Contact Information

3. Government Contracting Background, Principles, & Goals • Why does the US Government contract? • Because we cannot always produce the product or provide the service we require in house. • US Government contracting has to be in compliance with the FAR (Federal Acquisition Regulation) • FAR is located in Chapter 48 of the Code of Federal Regulations (CFR) • US Government contracting is based on 2 principles: • Competition. Quality goes up, price goes down. • Small Business Participation. Creates jobs, stimulates the economy. • Goals of the US Government in contracting: • Award to contractors who will provide a quality product or service, in the specified amount of time, within cost, while providing sound customer service to the US Government.

4. Acquisition Relationships The CO and the Contractor serve the COR. The COR determines the need and the requirements.

5. FAR Overview • Contracting Officer (CO) • A federal employee that has been granted the appointment to bind the US Government into contracts by obligating taxpayers’ dollars. • Inherently Governmental function • Education, Certification Levels, Experience, and Recommendation to become a CO • Appointment is in the form of a Warrant (standard form 1402) • The Senior Procurement Executive appoints Contracting Officers • CO has Actual Authority to bind the Government into contracts • Contracting Officer duties and responsibilities: • Know, comply, and implement the regulations/statutes of the FAR • Provide excellent customer service to our CORs • Compete requirements, Negotiate, and Award and modify contracts • Determine Fair & Reasonable price • Award to a contractor who is deemed to be Responsive & Responsible

6. Warrant

7. FAR Overview, continued… • Contracting Officer’s Representative • The federal employee responsible for the technical direction of the contract (PO/COR/COTR). Writes the SOW, expert in the product or service being procured, cannot award or modify contracts. Reviews monthly reports, inspects product, and works closely with the CO. Reviews invoices. Monitors Cost, Schedule, & Performance. • Illegal action by CO and COR • CO may not violate the Anti-Deficiency Act; meaning (1a) the CO may not spend money that was not allocated for a specific product or service or (1b) may not spend more than the amount of money allocated. (2) CO may not take a bribe of any monetary value. • COR cannot make a constructive change to the contract; meaning the COR cannot change the terms and conditions of the contract to increase the scope of work, increase the price, or change the delivery schedule. May result in a ratification of the unauthorized commitment. May lead to disciplinary action and could result in the COR being held financially responsible.

8. FAR Overview, continued… • Definition of a Contract • A mutually-binding legal relationship obligating the “seller” (contractor) to furnish supplies or services and the “buyer” (Government) to pay for them. • Contract Types • Firm-Fixed Price (FFP) – The price is fixed, contractor guarantees performance of the contracted work as a condition for being paid. • Cost Reimbursement (CR) – The contractor is paid up to a ceiling for all allowable costs. The contractor must put forth its best efforts in performing all work under the contract. • IDIQ (Indefinite Delivery/Indefinite Quantity) – The government’s quantity is unknown at time of award. Award Delivery Orders (DOs) off of the IDIQ. • 5 Elements of a Contract: (1) Offer, (2) Acceptance, (3) Competent Parties, (4) Mutual Consideration, (5) Legality of Purpose

9. FAR Overview continued.... • Market Research (FAR Part 10) • RFI (Request for Information), the Government wants to gather information on current capabilities within the market. • Sources Sought Notice, the Government wants to identify potential sources to provide the potential requirement. • Draft RFP (Request for Proposals), the Government wants to provide what an expected RFP would look like on a potential requirement, and receive feedback from industry. • Synopsis • The Government synopsizes the requirement in FedBizOpps.gov and states an anticipated RFP (Request for Proposal) release date. • Solicitation Methods [Only a warranted CO can post a solicitation] • Negotiations utilizes an RFP (Request for Proposal) • Negotiation, best value, trade off analysis. Results in source selection. • Simplified Acquisition Procedures utilizes a RFQ (Request for Quote) • 90% of all contracting, combine the synopsis and solicitation, used in commercial item acquisitions • Sealed Bidding utilizes IFB (Invitation for Bid) • Lowest price technically acceptable. Used for many construction & supply contracts. • Sole-Sourceis when the Government enters into negotiations with only one source.

10. FAR Overview continued….. • Uniform Contract Format (UCF)– A standard format that the federal government uses to delineate a solicitation or contract A – Solicitation/Contract Form H – Special Requirements B – Supplies/Services and Price/Costs I – Contract Clauses C – Statement of Work J – Attachments D – Packaging & Marking E – Inspection & Acceptance K – Representations & Certifications F – Delivery or Performance L – Instructions to Offerors G – Contract Administration data M – Evaluation Factors for Award • Privity of Contract • The US Government does not have privity/responsibility for the prime contractor’s sub-contractors.

11. FAR Parts • Federal Acquisition Regulation can be found at www.acquisition.gov • FAR comprised of 53 Parts, divided into 8 chapters. • FAR Parts pertinent to CORs and contractors: Part 2 – Definition Part 5 – Publicizing Contract Actions Part 6 – Competition Part 8 – Required Sources of Supply Part 10 – Market Research Part 12 – Commercial Part 13 – Simplified Part 15 – Contracting by Negotiation Part 16 – Contract Types Part 32 – Contract Financing Part 42 – Administration Part 43 – Contract Modifications Part 52 – Solicitation Provisions and Contract Clauses • HHSAR (Health & Human Services Acquisition Regulation) • supplement to the FAR for HHS, specific to agency procurements, chapter 3 of 48 CFR, found at: http://www.hhs.gov/regulations/hhsar/index.html

12. Phases of the Acquisition Process Phase I Acquisition Planning Phase II Solicitation / RFP Phase III Contract Administration Takes an Average of 9–12 months for Phases I & II

13. Phases of Acquisition Process Contract Administration RFP/Solicitation Acquisition Planning • 1Draft and Post Final Synopsis • • FedBizOpps.gov • 2 CO drafts and finalizes RFP for internal review • 3 Post Solicitation/RFP (request for proposal) • • FedBizOpps.gov • 4 Answer Questions submitted by Potential Offerors • 5 All Communication goes through the Contracting Officer • 6 Amend solicitation/RFP • 7 Receive & Record Proposals • 8 Distribute Proposals to TEP Team • 9 CO reviews business proposals and begins cost and price analysis • 10 Hold TEP • • Score Proposals to evaluation criteria • • Develop technical score • • Vote acceptable/Unacceptable • • TEP report to CO • 11 Determine Competitive Range • 12 Submit Questions to Offerors in Competitive Range. Notify those excluded. May conduct debriefings. • 13 Review Answers to Questions • 14 Negotiate, win-win solution • 15 Might need a revised proposal • 16 Request and Receive Final Proposal Revisions (FPR) • 17 Make a Source Selection • 18 Award Contract • 1 Copy of Contract to Contracting Officer Representative (COR) • • Highlight PO duties • 2 Post Award Kick-Off Meeting • 3 Read & Review Monthly Progress Reports • 4 Inspect and Accept Product or Service • 5 COR reports issues/concerns/problems to Contracting Officer • 6 Execute Contract Modifications • • Unilateral or Bilateral • • Exercise options • 7 Review & Approve Invoices • 8 Maintain Deliverables of Contractor • 9 Perform Site-visits to Contractor • 10 Perform Annual Evaluation of Contractor’s Performance • 11 Assist in Contract Closeout • * On average Contracts have a period of performance of 5 years • * Some have 1 base year + up to 4 option years (could have between 2–5 years total) • Determine a Need • Identify service/product desired 2 Assemble Acquisition Team • COR, CO, CS, AO, OGC, program team 3 Draft Statement of Work • Salient Characteristics • Deliverables • Delivery Schedule • Special Requirements, • Mandatory & Standard Evaluation Criteria • Technical Proposal Instructions 4 Develop an Acquisition Plan (AP) • Identify Sources • Conduct Market Research • Construct IGCE • Availability of Commercial Item • Competition Method (RFP) • Select contract type (FP/CR) • Select TEP members • Other issues (warranty/options) 5 Meet with Acquisition Team to review Draft SOW & Draft AP • Make corrections • Finalize SOW & Acquisition Plan • Present Final SOW and Final AP to the Contracting Officer

14. Phase I – Acquisition Planning Phases of Acquisition Process • Determine a Need • Identify a product or service desired • Assemble Acquisition Team • COR, CO, CS, AO, OGC, program team • Draft Statement of Work • Salient Characteristics • Deliverables • Delivery Schedule • Special Requirements, • Mandatory & Standard Evaluation Criteria • Technical Proposal Instructions • Develop an Acquisition Plan (AP) • Identify Sources • Conduct Market Research • Construct IGCE • Availability of Commercial Item • Competition Method (RFP) • Select contract type (FFP or CR) • Select TEP members • Other issues (warranty/options) • Meet with Acquisition Team to review Draft SOW & Draft AP • Make corrections, as necessary • Finalize SOW & Acquisition Plan • Present Final SOW and Final AP to the Chief Contracting Officer

15. Phase II – Solicitation / RFP Phases of Acquisition Process • Hold TEP • Score Proposals to evaluation criteria • Develop technical score • Vote Acceptable/Unacceptable • TEP report to CO • Determine Competitive Range • Submit Questions to Offerors in Competitive Range. Notify those offerors excluded. Debriefings possible. • Review Answers to Questions • Negotiate, win-win solution • Might need a revised proposal • Request and Receive FPR (Final Proposal Revisions) • Make a Source Selection • Award Contract • Draft and Post Final Synopsis • FedBizOpps.gov • CO drafts and finalizes RFP (request for proposal) for internal review • Post Solicitation/RFP • FedBizOpps.gov • Answer Questions submitted by Potential Offerors • All Communication goes through the Contracting Officer • Amend Solicitation/RFP • Receive & Record Proposals • Distribute Proposals to TEP Team • CO reviews business proposals and begins cost and price analysis

16. Phase III – Contract AdministrationPhases of Acquisition Process • Copy of Contract to COR • Highlight COR duties • Post Award Kick-Off Meeting • Usually at Contractor’s site • Read & Review Monthly Progress Reports • Inspect and Accept Product or Service • COR reports issues/concerns/problems to Contracting Officer • Execute Contract Modifications • Unilateral or Bilateral • Exercise options 7. Review & Approve Invoices 8. Maintain Deliverables of Contractor • Perform Site-visits to Contractor’s facility • Perform Annual Evaluation of Contractor’s Performance 11. Closeout the Contract *On average Contracts have a period of performance of 5 years *Some have a base year (first year) + up to 4 option years (could have between 2 – 5 years total). Longer with approval

17. Funding Vehicles • Contract - Legally binding relationship between two competent parties, for a lawful purpose, under clear terms, for consideration, and includes an offer & acceptance. • Grants - Different than contracts. Mechanism used to stimulate and support research, with little to no Government involvement. • Cooperative Agreements – Similar to grants, but with Government involvement. • Other Transaction Authority (OTA) - other than contracts, grants, and cooperative agreements. • Broad Agency Announcements (BAA) - For the acquisition of basic & applied research and that part of development not related to the development of a specific system or hardware procurement. Designed to advance the state of the art. • CRADA – Cooperative Research & Development Agreement

18. Difference between a Grant and a Contract Contract • For the sole purpose of supporting the Government • Solicitation: RFQ, IFB, RFP • Results in a: Quote, Bid, Proposal • Heavy Government oversight, interaction, and coordination • Procurement mechanism Grant • For the sole purpose of supporting the Public • Solicitation: FOA, RFA • Results in an: Application • Limited Government oversight, interaction, and coordination • Financial assistance mechanism

19. Contact Information Brian Goodger, Associate Director – OLAO http://olao.od.nih.gov/ OLAO/OALM/OD/NIH/HHS