More Federal Government Contracting Information
(Continued from Welcome page…)
The following is provided to give you some exposure to the statutory foundation of federal government contracting law, and to shine a light on the use of federal procurement regulations to implement and advance many of America’s economic and social policies. It will also give you an opportunity to look at sections of the Federal Acquisition Regulation system, which is the single, most important set of regulations you will want to be familiar with as a federal government contactor.
Also, the following may be thought of metaphorically as something not unlike skipping a stone across the water. In this analogy, however, each time the stone makes contact with the water, there is a glimpse at what lies beneath, and what lies beneath is substantial.
ASPA governs the acquisition of all property (except real estate), construction, and services by defense agencies, specifically the Department of Defense (DOD), the Coast Guard, and the National Aeronautics and Space Administration (NASA).
FPASA, on the other hand, governs acquisitions by civilian agencies, meaning mostly executive departments and agencies other than those governed by ASPA.
CICA applies to both defense and civilian agencies, requiring them to seek and obtain "full and open competition" wherever possible in the procurement process. CICA also, for the first time, gave the General Accounting Office — now the Government Accountability Office (GAO) — and the General Services Administration (GSA) Board of Contract Appeals the ability to hear and decide bid protests.
These three statutes — ASPA, FPASA, and CICA — have been amended, or otherwise affected, by additional legislation including the following (as amended):
- The Small Business Act of 1953 (SBA);
- The Truth in Negotiations Act of 1962 (TINA);
- The Office of Federal Procurement Policy Act of 1974 (OFFP);
- The Federal Acquisition Streamlining Act of 1994 (FASA);
- The Clinger-Cohen Act (CCA), formerly known as the Information Technology
Management Reform Act of 1996 (ITMRA);
- The Federal Acquisitions Reform Act of 1996 (FARA); and
- The Services Acquisition Reform Act 2003 (SARA).
“Full and open competition" is the clarion call of the federal government procurement process. In regard to fair and open competition, CICA codified three levels of competition policy, specifically:
- Fair and open competition;
- Fair and open competition after the exclusion of other sources; and
- Other than fair and open competition.
There are only seven sets of circumstances that permit the government to use other than “fair and open competition” procedures, all of which require prior written justification, approval and public disclosure. Those circumstances are:
- Only one responsible source;
- Unusual and compelling urgency;
- Industrial mobilization or research and development capability;
- International agreements;
- Authorized or required by statute;
- National security; and
- Public interest.
It should be noted that, within these circumstances — especially those under “5. Authorized or required by statute” and “7. Public interest” — the government is pursuing socioeconomic policy goals.
The Small Business Administration (also “SBA”) negotiates with agencies each year to establish "fair proportion" percentage goals (in dollar amounts) for the awards each agency will make to small businesses during the next fiscal year. And, an agency's success (or lack thereof) in meeting its goal is reported to Congress.
Small business set-asides — acquisitions exclusively reserved for the participation of small business concerns — help ensure that agencies meet their percentage goals for small business awards. For example, all federal procurements between $3,500 and $150,000 are set aside for small businesses. In addition, an agency may set aside all or part of a larger acquisition for award to a small business as the agency seeks to meet its annual percentage goal for awards to small businesses.
When awards are set aside for exclusive competitive participation by small business concerns, social policy becomes more evident, particularly when the small businesses are further qualified to include: SBA Section 8(a) business development participants; historically underutilized business zone (HUBZone) small business concerns; service-disabled veteran-owned small business concerns; economically disadvantaged women-owned small business concerns; and more.
- Simplified Acquisition Procedures (for which the government issues a “Request for Quotes”);
- Sealed Bidding (for which the government issues an "Invitation for Bids”);
- Two-Step Sealed Bidding;
- Negotiation (for which the government issues a “Request for Proposals”); and
- Special Procedures (used for research and development services, as well as architectural and engineering services).
I could provide you with more information about these, but that information would come from the FAR. So, let me direct you to those sections in the FAR so you may see how these procurement methods are addressed by the federal government.
- Fixed-Price Contracts;
- Cost-Reimbursement Contracts;
- Incentive Contracts;
- Indefinite-Delivery Contracts; and
- Time-and Materials, Labor Hour and Letter Contracts.
The pricing arrangement needed or desired by the agency — or mandated by regulation — will drive the decision on which contract type is used. Pricing arrangements allocate risk between the government and the contractor. Generally, a fixed-price contract allocates the least cost risk to the government while, conversely, a cost-reimbursement contract allocates the most cost risk to the government.
There are two UCF tables in the FAR. The first is “Table 14.1—Uniform Contract Format,”2 which is under Part 14—Sealed Bidding, at Subpart 14.201-1. The second is “Table 15.1—Uniform Contract Format,”3 which is under Part 15—Contracting by Negotiation, at Subpart 15.204-1. Following each UCF table are the parts and sections referenced in the table itself. However, while these UCF tables may appear to be identical to the uninitiated, they most assuredly are not. Table 14.1 applies to contract solicitations, and Table 15.1 applies to contract negotiations.
In each case, the involved parts and sections require the government — “to the maximum practical extent” — to prepare contracts in accordance the UCF. This has resulted in the great majority of “provisions” (used in solicitations) and “clauses” (used in contracts) becoming standardized as the government seeks and secures supplies and services from the private sector.
The fact of the matter is, the procurement process is highly regulated, starting well before the contract is reduced to writing, continuing throughout the contract’s period of performance, and extending well after that period of performance has ended. Moreover, the requirements for responding to contract announcements — be they Requests for Quotes, Invitations for Bids, Requests for Proposals, or solicitations for Special Procedures — are stringent. You have got to get it right the first time or — with very few, and very narrow, technical exceptions — your efforts will be for naught.
The government is required by law to make certain fair and open competition is accorded each and every bidder responding to a solicitation for supplies or services being sought by the government. As a consequence, the government will not deviate from the rules and regulations that ensure fair and open competition. So, if you do not provide what is required, or if you do provide it but fail to do so on a timely basis, you will be disqualified from competing further on the involved contract. And, of course, that means your company will have lost a substantial amount of time, effort and money.
To help you avoid such an outcome, I can:
- Help your company recognize, understand and adhere to the many complex rules and regulations governing the federal procurement process;
- Help make certain your company's response to a given solicitation is properly completed and timely submitted; and
- Should your company be awarded the sought after government contract, provide you with legal counsel before, during and after the contract's period of performance.
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- Footnote 1: The Federal Acquisition Regulation is available online at: https://www.acquisition.gov/?q=browsefar (opens a new window). You may download a complete copy in PDF or HTML for use offline. If you do, however, be certain to double-check any provisions you are relying upon before submitting any final bid or any related final documents. The FAR, and agency supplements to the FAR, are constantly updated.
- Footnote 2: Due to the way the acquisition.gov site is set up, a direct link to “Table 14-1—Uniform Contract Format” cannot be provided. So, first go to FAR Part 14—Sealed Bidding (opens a new window) and then click on “Subpart 14.201-1 Uniform Contract Format.” Once you have clicked through to that subpart, scroll down to “Table 14-1—Uniform Contract Format.”
- Footnote 3: Due to the way the acquisition.gov site is set up, a direct link to “Table 15-1—Uniform Contract Format” cannot be provided. So, first go to FAR Part 15—Contract by Negotiation (opens a new window) and then click on “Subpart 15.204-1 Uniform Contract Format.” Once you have clicked through to that subpart, scroll down to “Table 15-1—Uniform Contract Format.”