developing an independent Government cost estimate.]. Nonrecurring costs include such costs, where applicable, as plant or equipment relocation or rearrangement, special tooling and special test equipment, preproduction engineering, initial rework, initial spoilage, pilot runs, allocable portions of the costs of facilities to be acquired or established for the conduct of the work, costs incurred for the assembly, training, and transportation to and from the job site of a specialized work force, and unrealized labor learning. The final rule revises FAR 19.202-1 to require contracting officers to provide procurement center representatives copies of any proposed acquisition package and other reasonably obtainable information related to the acquisition, if the representatives exercise their discretion to review the acquisition. some methods of contracting require more time than others (C) The servicing agency is specifically authorized by law or regulation to purchase such supplies or services on behalf of other agencies. The extent to which cancellation terms are used in multi-year contracts will depend on the unique circumstances of each contract. (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. Any contract between two or more parties to deliver services or goods is a procurement contract. (a) Effective work performance under management and operating contracts usually involves high levels of expertise and continuity of operations and personnel. The use of such a contract will result in significant savings of the total estimated costs of carrying out the program through annual contracts; (2) (a) Insert a provision substantially the same as the provision at 52.217-3, Evaluation Exclusive of Options, in solicitations when the solicitation includes an option clause and does not include one of the provisions prescribed in paragraph (b) or (c) of this section. In Step 3, parties commit to six guiding principles that contractually prohibit opportunistic tit-for-tat moves. The wording crafted by Island Health and South Island, which they embedded in the preamble of their contract, can be used by other companies as a model for drafting their own guiding principles. (a) Obtaining both also provides a basis for the computation of savings and other benefits. An example of a circumstance that may support a determination not to evaluate offers for option quantities is when there is a reasonable certainty that funds will be unavailable to permit exercise of the option. In long-term, complex deals, shading can be so pervasive that the tit-for-tat behavior becomes a death spiral. (d) The work is closely related to the agencys mission and is of a long-term or continuing nature, and there is a need-, (1) To ensure its continuity; and. Their efforts led to the vested methodology for creating formal relational contractsa process that establishes a whats in it for we partnership mentality. But the process we have outlined should be part of the contracting tool kit to govern highly complex relationships that demand collaboration and flexibility. (a) (i) State that use of an interagency acquisition is in the best interest of the Government; (ii) State that the supplies or services cannot be obtained as conveniently or economically by contracting directly with a private source; and. (b) Multi-year contracting is a flexible contracting method applicable to a wide range of acquisitions. (1) The option cannot be evaluated under 17.206; or; (2) Future competition for the option is impracticable. Value-eroding friction and shading occur because one or both parties feel unfairly treated. Formal relational contracts will never completely replace traditional transactional contracts. (b) Insert a provision substantially the same as the provision at 52.217-4, Evaluation of Options Exercised at Time of Contract Award, in solicitations when the solicitation includes an option clause, the contracting officer has determined that there is a reasonable likelihood that the option will be exercised, and the option may be exercised at the time of contract award. repairs. Criteria for comparing the lowest evaluated submission on the first program year requirements to the lowest evaluated submission on the multi-year requirements. (a) A DoD acquisition official may request a nondefense agency to conduct an acquisition on behalf of DoD in excess of the simplified acquisition threshold only if the head of the nondefense agency conducting the acquisition on DoD's behalf has certified that the agency will comply with applicable procurement requirements for that fiscal year except when waived in accordance with paragraph (e) of this section. (3) Whether it is likely that qualified offerors will compete for the contract. If it is anticipated that the best price available is the option price or that this is the more advantageous offer, the contracting officer should not use this method of testing the market. (1) Functions involving the direction, supervision, or control of Government personnel, except for supervision incidental to training; (2) Functions involving the exercise of police or regulatory powers in the name of the Government, other than guard or plant protection services; (3) Functions of determining basic Government policies; (4) Day-to-day staff or management functions of the agency or of any of its elements; or. $150 million However, the preparation and evaluation of dual offers may increase administrative costs and workload for both offerors and the Government, especially for large or complex acquisitions. (c) The conduct of the work is wholly or at least substantially separate from the contractors other business, if any. (c) Solicitations normally should allow option quantities to be offered without limitation as to price, and there shall be no limitation as to price if the option quantity is to be considered in the evaluation for award (see 17.206). (3) The requesting agency shall furnish a copy of the D&F to the servicing agency with the request for order. The nature of the requirement should govern the selection of the method of contracting, since the multi-year procedure is compatible with sealed bidding, including two-step sealed bidding, and negotiation. (e) The determination of other factors under paragraph (c)(3) of this section-, (1) Should take into account the Governments need for continuity of operations and potential costs of disrupting operations; and. 17.604 Identifying management and operating contracts. In addition to complying with the interagency acquisition policy and procedures in this subpart, nondefense agencies acquiring supplies and services on behalf of the Department of Defense shall also comply with the policy and procedures at subpart 17.7. Examples of more specific authority are 40 U.S.C. The objectives of this technique are one or more of the following: (a) Reduce delivery time. 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. When using sealed bidding, the contracting officer shall make a written determination that there is a reasonable likelihood that the options will be exercised before including the provision at 52.217-5, Evaluation of Options, in the solicitation. CLC 222 Mod 4 Contract Monitoring Exam.docx, CLC 222 Module 4 Exam Contract Monitoring - Performance.docx, CLC 222 Module 6 Exam Special Considerations.docx, Contract Monitoring - Performance Exam - 1st Attempt.pdf, The service contract act was enacted to protect economies in the geographical areas where the contract is performed. Consider how the Island Health administrators and South Island hospitalists tackled pricing, which had always been their sticking point. A.) We put everything on the table, and we challenged the contracting team to figure out ways to work with the money weve got.. (c) Requirements for determinations and findings. Each lacked trust and confidence in the other, yet neither could afford to end the relationship. They should analyze their dependency on the particular supplier, the strategic value of its product, and the impact of nonperformance on a buyers operations. (a) The contracting officer may award a prime contract to a-. In two-step sealed bidding, discussions conducted during the first step may indicate the need for revised ceilings and dates which may be incorporated in step two. Written contracts that are legally enforceable (which is why we call them formal), they include many components of a traditional contract but also contain relationship-building elements such as a shared vision, guiding principles, and robust governance structures to keep the parties expectations and interests aligned. (b) Type of contract. The inclusion of recurring costs in cancellation ceilings is an exception to normal contract financing arrangements and requires approval by the agency head. We will make decisions based on a balanced assessment of needs, risks, and resources.. (e) 1) Funds must be available to cover the check value and the bank's processing fee 2) The Cardholder can dispute a. (1) A description of the supplies or services required; (2) Delivery requirements; (3) A funds citation; (4) A payment provision (see 17.502-2(d) for Economy Act orders); and. The minimum need to be purchased is expected to remain substantially unchanged during the contemplated contract period in terms of production rate, procurement rate, and total quantities; (3) The parties created a joint project collaboratively working with billing support and IT technologists to develop an electronic billing program to maximize billing submissions, ultimately improving cost recovery from 87% to 100%. The written determination shall identify the acquisition categories to which the waiver applies. It may be negotiated as a percentage of the estimated costs but it is written into the contract as a precise amount, not a percentage. 3501 and provides policy and procedures for the use of multi-year contracting. A sole source procurement (called an Other than Full & Open Competition) is when the government enters into a contract with a contractor without going through the typical competitive process as required by law because it deems that the contractor is the only source available that can meet the government requirements. Which of the following is, [Identify the various methods of contracting for, Ordering off a Blanket Purchase Agreement, Buys against a GSA Federal Supply Schedule. Under the new pricing model, when the inpatient population is low, the hospitalists can opt to take time off and save Island Health money.