Welcome to the
NCMA Small Business Conference and Trade Fair
Source Selection Industry Updates Briefing
Thursday, April 10, 2014
South Shore Resort and Conference Center
3:00 p.m. – 4:00 p.m.
Disclaimer
This briefing is provided for informational purposes
only and does not apply to any specific solicitation.
Each solicitation has its own set of Instructions,
Conditions, and Notices to Offerors and Evaluation
Factors for Award. When submitting proposals in
response to a solicitation, carefully read the
Instructions, Conditions, and Notices to Offerors and
Evaluation Factors for Award for that particular
solicitation.
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Objective
To communicate updates to the JSC Source Selection
processes to help Industry better prepare and respond
to the JSC Request for Proposals.
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Agenda
Speaker
Anna Carter, Contracting Officer
JSC Source Selection Office
Wally Khan, Price Analyst
JSC Source Selection Office
Suzan P. Thomas, Contracting Officer and
Contractor Industrial Relations Officer
JSC Source Selection Office
Subject
Connections and Strengths in Discussions
Pricing Updates & Indirect Rates Clarifications
Tips for Avoiding Common Mistakes in Total
Compensation Plans (TCPs)
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Connections
Anna Carter
Contracting Officer
JSC Source Selection Office
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JSC Source Selection Office
“CONNECTIONS”
…Coming soon
GOAL
To increase transparency, the JSC Source Selection Office has
identified a way to provide a platform for collaboration and
innovation through the use of “Connections”.
This web link will allow the Office of Procurement to post new
ideas and solicit feedback from Industry aimed at improving the
efficiency and effectiveness of future competitive processes.
The desire is to foster working level exchanges, in addition to
executive communiques. The intent of “Connections” is to publish
information based on those topics or ideas that would better
serve the contracting community as a whole.
INTENDED USES
• This tool will provide the Office of Procurement an avenue to seek
feedback and/or socialize new processes or initiatives.
– Thumb drives vs. CD’s
– Strengths in Discussions
– Average SLC rate data in the technical library
• This tool is not intended to solicit feedback or questions about
ongoing competitive acquisitions.
Strengths Provided in Discussions
To enhance our potential for increasing best value, a pilot
program of providing strengths during “discussions” will
begin with the Communications, Outreach, Multi-media &
Information Technology (COMIT) procurement.
We want to hear from you!
Point of Contact:
Anna Carter
JSC Source Selection Office
Phone: (281) 483-1869
Email: Anna.Carter-1@nasa.gov
Pricing Updates & Indirect Rates
Clarifications
Wally Khan
Cost/Price Analyst
JSC Source Selection Office
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Incumbent Retention Data
• Total Compensation Template (e): Incumbency Assumptions [TC(e)]
was revised to better support the data collection needed to fully
understand an offeror’s strategy regarding incumbent retention and
compensation.
• Lack of clarity regarding an offeror’s proposed approach can result in
– prolonged discussion periods
– a slip in planned award date
• Recent changes to how incumbent data is captured in solicitations:
– TC(e) revision
– Technical Resources Template (TRT) revision
– Inclusion of ‘incumbent’ definition in RFP: “current person
performing same or similar function on current contract”
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NEW TC(e): Incumbency Assumptions
Compensation Template (e): Incumbency Assumptions
[ ] Prime Contractor:
[ ] Major Subcontractor:
[ ] Minor Subcontractor:
Incumbent Retention
Labor Rates
Seniority Rights
Proposing to fill __% of positions with incumbents.
Proposing to fill __% of positions with non-incumbents.
Proposing to pay __% of incumbents current incumbent direct labor rates.
Proposing to pay __% of incumbents other than current incumbent direct labor rates.
Proposing to maintain seniority rights for fringe purposes for __% of incumbents.
Proposing to not maintain seniority rights for fringe purposes for __% of incumbents.
Note 1: Offeror team members shall fill in all fields in each category above. Ensure that you provide supporting
rationale with specific details, in narrative form, explaining the proposed approach indicated above.
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NEW Sample TRT
Sample TECHNICAL RESOURCES TEMPLATE (TRT)
Prime Contractor Name:
SOW 3.0 Engineering Projects
PRIME AND ALL SUBCONTRACT (INCLUDING MINOR SUBCONTRACTORS) RESOURCES COMBINED
NASA (JSC)
Standard Labor Category
WYEs
Program Manager
Management/Supervisor
Engineer V
Engineer IV
Engineer II
Engineer I
Technician III
Technician II
Technical Professional
IT/Database Professional
IT Professional
Business Specialist (non G&A)
Professional/Administration
Administrative Specialist
Clerical/Secretary
Other: (Specify)
Other
Total WYE Prime and All Subs
Incumbent
Retention %
% Incumbents at SOW (Roll-up)
Current DL Rates
3.0
SOW
3.1.1
SOW
3.1.2
SOW
3.1.3
SOW
3.7
Skill mix
Ratio
#DIV/0!
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
#DIV/0!
0
#DIV/0!
0
#DIV/0!
0
#DIV/0!
0
#DIV/0!
0
-
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Future Pricing Changes
• In the interest of further streamlining the source
selection process, the Government is exploring
alternative approaches to providing offerors’ feedback
on incumbent direct labor rates.
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Indirect Rates
•
•
•
•
•
Indirect rates in proposals
Three years prior rates
Trend
Causes of increasing or decreasing rates
Review the development of rates and presentation in
proposals
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Typical Indirect Rates
• Fringe Rate(s) – an indirect rate that captures the cost
of employee benefits
• Overhead Rate(s) – an indirect rate that relate(s) to the
product or service being produced but cannot be
realistically charged on a direct basis. May include
Fringe Costs as well.
• General and Administrative Rate – an indirect rate that
usually relates to costs to the company as a whole.
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Indirect Rate Structure
Pool
Common Pools:
1) Fringe Costs
2) Overhead Costs
3) G&A Costs
• Calculation:
Indirect Rate = Indirect Cost Pool = $150 = 30%
Allocation Base
$500
Common Bases:
1) Direct Labor Hours
2) Direct Labor Costs
3) # of Units Produced
4) # of Machine Hours
Base
Burden
Total Cost Input = All Cost except G&A
Value added Input = Generally Total Cost
Input less materials and subcontracts
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Fringe Rates
• Employee fringe benefit costs (e.g., payroll taxes,
vacation, sick, retirement, health care, bonus, deferred
compensation, insurance, etc.)
• Calculation:
Fringe Rate = Fringe Pool
Total Labor Dollars
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Overhead Rate
• Management or supervision of activities or cost of certain
segments of a business unit that benefit more than one project,
contract or award, but not the business unit as a whole (e.g.,
division middle management, supervisors, project leadership
benefiting multiple projects, site rent, etc.)
• These are costs that would not be incurred if it was not for the
awarded contract
• Calculation:
Overhead Rate =
Overhead Pool
Loaded Direct Labor Dollars
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G & A Rate
• Management and administration costs that benefit
the business unit as a whole (e.g., Accounting, H.R.,
OCFO, Legal, Chief Executive Officer, B&P)
• Costs for running the business
• Calculation:
G&A Rate =
G&A Pool .
Total Cost Input
• Other basis include value-added cost input
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Tips for Avoiding Common Mistakes
in Total Compensation Plans (TCPs)
Suzan P. Thomas
Contracting Officer and Contractor Industrial Relations Officer
JSC Source Selection Office
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Regulatory Requirements
•
FAR 52.222-46:
– “Professional compensation that is unrealistically low or not in reasonable
relationship to the various job categories, since it may impair the
Contractor’s ability to attract and retain competent professional service
employees, may be viewed as evidence of failure to comprehend the
complexity of the contract requirements.”
•
The standard TCP Data Requirements Description (DRD) states: “The TCP
and Total Compensation Templates (a) through (e) shall be required for both
the prime team members and all subcontractors that meet the criteria in NFS
1852.231-71(d).”
– Many proposals lack the required subcontractor TCPs and Templates,
making it difficult to evaluate the offeror’s responsiveness in this area.
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Page Limits
•
We have eliminated page limits for TCPs because we could not identify a
page limit that would level the playing field for all offerors.
– Some offerors propose no subcontractors, some propose one, and others
propose numerous subcontractors.
– Use your best business judgment to ensure that you have addressed all
areas of the TCP DRD.
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Specific Fringe Benefits
•
Be specific when describing each fringe benefit offered to employees.
− When is the employee eligible for the benefit?
− What is the specific benefit offered?
 For example: “We offer company paid life insurance” versus “We
offer company paid life insurance in the amount of 1 times the
employees annual salary.”
− What percentage is paid by the company and what percentage is paid
by the employee?
• Also be specific when describing employee paid benefits.
− For example, if short-term disability insurance is “employee paid”, then
discuss the specific benefit offered, and how much the employee will
pay for this benefit.
− If a job is physical in nature, and disability insurance is not covered, then
discuss why.
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Wage Determinations
•
It is the offeror’s responsibility to identify and map their non-exempt labor
categories to an appropriate category in the wage determination.
– Use the Service Contract Act Directory of Occupations, 5th Edition at:
http://www.dol.gov/whd/regs/compliance/wage/SCADirV5/SCADirectVer
s5.pdf
•
Pay attention to the Service Contract Act Health & Welfare Benefit in the
wage determination.
– The current benefit is $3.81 an hour. Many proposals include an
amount that is lower and usually matches the prior year’s amount.
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Total Compensation Templates
•
Ensure consistency between the TCP and the Compensation Templates.
− For example, if the TCP states that life insurance is offered to
employees, and TC(c), Fringe Benefit Analysis Package states: “0.00”
under the cost of the fringe benefit, then there is an inconsistency.
− Ensure that the benefit offered to employees in the TCP are consistent
with the benefits offered to employees in TC(d) Personnel and Fringe
Benefit Policies.
 TC(d) is intended to be a summary of benefits for the convenience
of the evaluators.
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Standard Labor Categories
•
•
Ensure that you understand the description and relative responsibility level
of each standard labor category.
Ask the Contracting Officer if the RFP is not clear.
− We look at the offeror’s description of the labor categories and the labor
rates proposed for each labor category to determine if the offeror
understands the work to be performed and the relative responsibility
levels of the labor categories.
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