The need for the supplies or services is reasonably firm and continuing over the period of the contract; and. 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. Shading happens when a party isnt getting the outcome it expected from the deal and feels the other party is to blame or has not acted reasonably to mitigate the losses. When Dell originally selected FedEx, in 2005, to handle all aspects of its hardware return-and-repair process, the companies drew up a traditional supplier contract. In order to establish a multi-agency or governmentwide acquisition contract, a business-case analysis must be prepared by the servicing agency and approved in accordance with the OFPP business case guidance, available at https://www.whitehouse.gov/wp-content/uploads/legacy_drupal_files/omb/procurement/memo/development-review-and-approval-of-business-cases-for-certain-interagency-and-agency-specific-acquisitions-memo.pdf . For acquisitions on behalf of the Department of Defense, also see subpart 17.7. (c) The period shall be set so as to provide the contractor adequate lead time to ensure continuous production. You also have an on-premises Active Directory domain that contains a user named User1. 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. (a) The Economy Act ( 31 U.S.C.1535) authorizes agencies to enter into agreements to obtain supplies or services from another agency. (c) This subpart does not apply to-, (1) Interagency reimbursable work performed by Federal employees (other than acquisition assistance), or interagency activities where contracting is incidental to the purpose of the transaction; or. Cancellation charge means the amount of unrecovered costs which would have been recouped through amortization over the full term of the contract, including the term canceled. The formal relational contract addresses these deficiencies. 2. 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. The main disadvantages are: they will not reflect project-specific risks or unusual provisions in the master contract; In this article, we look at the theoretical underpinnings of formal relational contracts and lay out a five-step methodology for negotiating them. And in a publicly funded health care environment, that is exactly what we need to be focusing on., The governance structure also helped the parties surmount the tricky problem of scope creep. Under reciprocity, for example, they highlighted the need to conduct ourselves in the spirit of achieving mutual benefit and understanding. Under equity, they acknowledged the unavoidable imbalances that arise in contracts: We are committed to fairness, which does not always mean equality. Obtaining both annual and multi-year offers provides reduced lead time for making an annual award in the event that the multi-year award is not in the Governments interest. Oliver and Moores expanded theory focuses on contracts as reference points, a new perspective that emphasizes the need for mechanisms to continually align expectationsor update reference pointsas unanticipated events occur and needs change over time. (1) The solicitation contains an option clause; (2) An option is not to be exercised at the time of contract award; (3) A firm-fixed-price contract, a fixed-price contract with economic price adjustment, or other type of contract approved under agency procedures is contemplated; and. This is necessary for situations when exercise of the option would result in the obligation of funds that are not available in the fiscal year in which the contract would otherwise be completed. A provision that, if the Government determines before award that only the first program year requirements are needed, the Governments evaluation of the price or estimated cost and fee shall consider only the firstyear. At the same time that Oliver and Moore were looking at the contracting problem from an economics perspective, University of Tennessee researchers (including two of us, Kate and David) were working with companies to come up with a new approach that would produce healthier and more sustainable partnerships. There is a stable design for the supplies to be acquired, and the technical risks associated with such supplies are not excessive; (4) From the following statements, select the correct statement pertaining to the, Personnel services contracts are authorized by the government When? In a negotiated acquisition, negotiations with offerors may provide information requiring a change in cancellation ceilings and dates before final negotiation and contract award. There is a reasonable expectation that, throughout the contemplated contract period, the head of the agency will request funding for the contract at a level to avoid contract cancellation; and. 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. Here is your test result.The dots represent the choices you have made. (b) For DoD, NASA, and the Coast Guard, a multi-year contract which includes a cancellation ceiling in excess of $150 million may not be awarded until the head of the agency gives written notification of the proposed contract and of the proposed cancellation ceiling for that contract to the committees on armed services and appropriations of the House of Representatives and Senate. (4) In no event shall the servicing agency require, or the requesting agency pay, any fee or charge in excess of the actual cost (or estimated cost if the actual cost is not known) of entering into and administering the contract or other agreement under which the order is filled. Exam (elaborations) - Clc 222 mod 6 special considerations exam 2. May use an economic price adjustment clause authorized by 16.203, when potential fluctuations require coverage and are not included in cost contingencies provided for by the clause at 52.222-43. These include contracting with multiple suppliers, forcing suppliers to lock in prices, using termination-for-convenience clauses, or obligating suppliers to cover activities that might arise after the initial contracting phase. The remedy is to adopt a totally different kind of arrangement: a formal relational contract that creates a flexible framework designed to foster collaboration in complex strategic relationships over the long term. However, statutes applicable to various classes of contracts, for example, the Service Contract Labor Standards statute (see 22.1002-1), may place additional restrictions on the length of contracts. A statement that award will not be made on less than the first program year requirements. (d) Contracts awarded under the multi-year procedure shall be firm-fixed-price, fixed-price with economic price adjustment, or fixed-price incentive. The requesting agency administers the order; therefore, no written agreement with the servicing agency is required. (a) Unfortunately, this story is not unique. (David and Kate have consulted on many of these projects, including several mentioned in this article.) You need to ensure, Prior to certifying the Managing Accounting Billing Statement for contract payments by Governmentwide Commercial Purchase Card, the Approving/ Billing Official must do what two things? A 60-day termination for convenience translates to a 60-day contract, one CFO at a supplier told us. The parties ultimately came up with an alternative to the standard fee-for-billable-hours method. Cash flow is easier to predict in a lump sum contract. Shading happens when one party isnt getting the outcome it expected. Contract Types | Contracts | CDC (d) Cancellation charge means the amount of unrecovered costs which would have been recouped through amortization over the full term of the contract, including the term canceled. Other contract types include incentive contracts, time-and-materials, labor-hour contracts, indefinite-delivery contracts, and letter contracts. However, it does not preclude the use of options in those contracts. In unusual circumstances, an authorized person at a level above the contracting officer may approve a greater percentage of quantity. (a) (1) 3903 and 10 U.S.C. Cancellation ceiling means the maximum cancellation charge that the contractor can receive in the event of cancellation. (g) Solicitations that require the offering of an option at prices no higher than those for the initial requirement shall-, (1) Specify that the Government will accept an offer containing an option price higher than the base price only if the acceptance does not prejudice any other offeror; and. (g) Insert a clause substantially the same as the clause at 52.217-9, Option to Extend the Term of the Contract, in solicitations and contracts when the inclusion of an option is appropriate (see 17.200 and 17.202) and it is necessary to include in the contract any or all of the following: (1) A requirement that the Government must give the contractor a preliminary written notice of its intent to extend the contract. (b) The approach encourages trust and honesty between the two sides, said Ken Smith, a hospitalist at South Island. (f) Avoidance of the need for establishing quality control techniques and procedures for a new contractor each year. Course Hero is not sponsored or endorsed by any college or university. (5) Functions that can more properly be accomplished in accordance with subpart 45.3, Authorizing the Use and Rental of Government Property. (g) Facilitate the transition from development to production and to subsequent competitive acquisition of end items or major components. (h) Providing incentives to contractors to improve productivity through investment in capital facilities, equipment, and advanced technology. This type of contract is typically used for well-defined, small-scale projects in which changes are rare. A contract is a binding agreement between a buyer and a seller. 10) Some methods of contracting require more time than others. (e) (2) The potential cost of disrupted support, options may be included in service contracts if there is an anticipated need for a similar service beyond the first contract period. 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%. Office of the Director of National Intelligence; Intelligence elements of the Federal Bureau of Investigation, Department of Energy, and Drug Enforcement Agency; Bureau of Intelligence and Research of the Department of State; Office of Intelligence and Analysis of the Department of the Treasury; The Office of Intelligence and Analysis of the Department of Homeland Security and the Office of Intelligence of the Coast Guard; and. Multi-year contract means a contract for the purchase of supplies or services for more than 1, but not more than 5, program years. What Is a Unit Price Contract & When to Use It? | NetSuite (e) Insert a clause substantially the same as the clause at 52.217-7, Option for Increased Quantity-Separately Priced Line Item, in solicitations and contracts, other than those for services, when the inclusion of an option is appropriate (see 17.200 and 17.202) and the option quantity is identified as a separately priced line item having the same nomenclature as a corresponding line item. Wide web 10 some methods of contracting require more - Course Hero Except for DoD, NASA, and the Coast Guard, a multi-year contract which includes a cancellation ceiling in excess of To perform this calculation, the contracting officer should obtain in-house engineering cost estimates identifying the detailed recurring and nonrecurring costs, and the effect of labor learning. (f) Presolicitation or pre-bid conferences. (d) The contracting officer, after considering price and other factors, shall make the determination on the basis of one of the following: (1) A new solicitation fails to produce a better price or a more advantageous offer than that offered by the option. (1) Leader company, obligating it to subcontract a designated portion of the required end items to a specified follower company and to assist it to produce the required end items; (2) Leader company, for the required assistance to a follower company, and a prime contract to the follower for production of the items; or. To satisfy requirements of part 6 regarding full and open competition, the option must have been evaluated as part of the initial competition and be exercisable at an amount specified in or reasonably determinable from the terms of the basic contract, e.g.-. Information on such committees may not be readily available to contracting officers. Stabilization of contractor work forces. If level unit pricing is not in the Governments interest, the head of a contracting activity may approve the use of variable unit prices, provided that for competitive proposals there is a valid method of evaluation. Subpart 15.1 - Source Selection Processes and Techniques - Acquisition Government Contracting Rules You Need to Know | Wolters Kluwer Further, the rule revises procurement . (b) Solicitations containing option provisions shall state the basis of evaluation, either exclusive or inclusive of the option and, when appropriate, shall inform offerors that it is anticipated that the Government may exercise the option at time of award. (c) Subpart 17.4 - Leader Company Contracting, Subpart 17.6 - Management and Operating Contracts. The inclusion of recurring costs in cancellation ceilings is an exception to normal contract financing arrangements and requires approval by the agency head. For DoD, NASA, and the Coast Guard, the head of the agency may enter into a multi-year contract for supplies if-. Course Hero is not sponsored or endorsed by any college or university.
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