Thank You for Joining Us,
The Webinar Will Begin Shortly.
Federal Construction Contracting: Core Curriculum unit,
Webinar No. 1
THE FUNDAMENTALS OF THE FEDERAL ACQUISITION REGULATION AND
THE FEDERAL PROCUREMENT
Part 1: The Bidding Process
While you are waiting please check out the
Upcoming Webinars on www.GiveMe5.com.
Before we begin … just a few notes:
•
During the presentation lines will be muted so only presenters can be heard.
•
While you are listening please also put your phone on mute
•
Do NOT put your phone on hold – please hang up and call back
•
If having trouble viewing the presentation – please close out and log in
using a different browser
•
If your slides are not moving please refresh or log out & then log back in
•
If you have any questions during the presentation, please feel free to enter
them into the discussion box on the bottom left of your screen
FEDERAL CONSTRUCTION CONTRACTING:
CORE CURRICULUM UNIT, WEBINAR NO. 1
THE FUNDAMENTALS OF THE FEDERAL ACQUISITION
REGULATION AND THE FEDERAL PROCUREMENT
Part 1: The Bidding Process
Presented By:
JENNIFER M. HORN & MARIA L. PANICHELLI
for
Women Impacting Public Policy and Give me 5
WIPP is a national nonpartisan public policy organization,
advocating on behalf of nearly 4.7 million businesses women
representing 78 Coalition Partners. WIPP provides timely
economic policy information and identifies important trends and
opportunities to its membership.
www.WIPP.org
Give Me 5
• National program from WIPP & American Express OPEN designed to
educate women business owners on how to apply for and secure federal
procurement opportunities.
• Give Me 5 works to increase the representation of Women Business
Owners that win government contracts. We provide accessible business
education tools to assist both new and experienced federal contractors.
• Women Business Owners could gain more than $4 billion in annual
revenues if the 5% contracting goal set by Congress was reached.
FEDERAL CONSTRUCTION CONTRACTING:
CORE CURRICULUM UNIT, WEBINAR NO. 1
THE FUNDAMENTALS OF THE FEDERAL ACQUISITION
REGULATION AND THE FEDERAL PROCUREMENT
Part 1: The Bidding Process
Presented By:
JENNIFER M. HORN & MARIA L. PANICHELLI
for
Women Impacting Public Policy and Give me 5
Procurement Process: A Primer
Essentially, the federal acquisition process begins when a government
agency determines its requirements and how to purchase them.
If the agency’s contracting officer determines that the appropriate
method for procuring the goods or services is a contract, and the
contract amount is greater than $25,000, then the agency posts a
solicitation on the Federal Business Opportunities website.
https://www.fbo.gov/
Procurement Process
And So It Begins…
It Is All About Procurement!
There is a procurement process for the acquisition
of supplies, services, construction, and research
and development
It all begins with the establishment of a
requirement.
8
Procurement Process
The Genesis of a Procurement
A requirement that comes from legislation
A requirement that comes from an on-going
agency program
A requirement that comes from operation and
maintenance funding (“O&M”)
A requirement that comes from emergency
legislation
Procurement Process
Who Is “Procuring?”
Who is it that is requesting services or supplies?
10
Understanding Federal Agencies
You must learn about the table of organization and
the chain of command…
DoD Organization Chart
Army Corps of Engineers
• The United States Army Corps of Engineers (USACE) is a
federal agency and a major Army command made up of some
38,000 civilian and military personnel, making it the world's
largest public engineering, design and construction
management agency.
• Although generally associated with dams, canals and flood
protection in the United States, USACE is involved in a wide
range of public works support to the nation and the
Department of Defense throughout the world.
• The Corps of Engineers provides outdoor recreation
opportunities to the public, and provides 24% of U.S.
hydropower capacity.
Organization of the Corps
Los Angeles District
Procurement Process
How Do I Bid?
Procurement Process
System for Award Management (“SAM”)
Step 1 Register in SAM.
The System for Award Management (SAM) is combining federal
procurement systems and the Catalog of Federal Domestic Assistance into
one new system. This consolidation is being done in phases. The first phase
of SAM includes the functionality from the following systems:
Central Contractor Registry (CCR)
Federal Agency Registration (Fedreg)
Online Representations and Certifications Application
Excluded Parties List System (EPLS)
Procurement Process
Various Certifications
In addition to general SAM registration, make sure you are registered as a
participant in the various small business programs for which you are
eligible:
• ED/WOSB
• VOSB/SDVOSB
• 8(a)
• HUBZone
• ANCs and Tribes
Procurement Process
What Governs the Bidding
Process?
It Is The FAR, Not The FARs!
The Federal Acquisition Regulation (“FAR”) is
established for the codification and
publication of uniform policies and
procedures for acquisition by all executive
agencies.
48 CFR – Chapter 1
FAR History
• The FAR is the primary regulation for use by all Federal
Executive agencies in their acquisition of supplies and
services with appropriated funds.
• It became effective on April 1, 1984, and is issued within
applicable laws under the joint authorities of the
Administrator of General Services, the Secretary of
Defense, and the Administrator for the National
Aeronautics and Space Administration, under the broad
policy guidelines of the Administrator, Office of Federal
Procurement Policy, Office of Management and Budget.
• ASPR  DAR  FAR
FAR Organization
• The FAR is divided into subchapters, parts (each of which covers a separate
aspect of acquisition), subparts, sections, and subsections.
FAR System
• The Federal Acquisition Regulation System
consists of the FAR, which is the primary
document & agency acquisition regulations
that implement or supplement the FAR
Agency Supplemental Regs
• Defense Federal Acquisition Regulation Supplement
(DFARS)
• Army Federal Acquisition Regulation Supplement (AFARS)
• Engineer Federal Acquisition Regulation Supplement
(EFARS)
• http://farsite.hill.af.mil/
• http://www.acquisition.gov/far/index.html
FAR Limitations
• The FAR precludes agency acquisition regulations that
unnecessarily repeat, paraphrase, or otherwise restate the
FAR, limits agency acquisition regulations to those
necessary to implement FAR policies and procedures
within an agency, and provides for coordination, simplicity,
and uniformity in the Federal acquisition process. It also
provides for agency and public participation in developing
the FAR and agency acquisition regulation.
FAR Location
• The official and most current FAR resources are
web-based
• These sites also have archived documents and
search capabilities
• http://farsite.hill.af.mil/
• http://www.acquisition.gov/far/index.html
• http://www.gpoaccess.gov/cfr/index.html
FAR Maintenance
• FAR is prepared and issued through the coordinated
action of two councils:
– Defense Acquisition Regulations Council (DAR Council)
– Civilian Agency Acquisition Council (CAA Council).
• FAR Secretariat (GSA) prints, publishes & distributes
the FAR
Federal Acquisition Circular
• Issued to advise of new regulations, policies and
procedures
• www.regulations.gov/fdmspublic/component/main
• Regularly updated; check out our blog for news about
changes or proposed changes to the FAR
Procurement Process
FAR 1.102 -Statement of Guiding Principles for the Federal Acquisition System.
• The vision for the Federal Acquisition System is to
deliver on a timely basis the best value product or
service to the customer, while maintaining the
public’s trust and fulfilling public policy objectives.
Participants in the acquisition process should
work together as a team and should be
empowered to make decisions within their area of
responsibility.
Procurement Process
How Does the Bidding
Process Work?
Significant Contracting Methods
• Sealed Bidding (FAR 14)
• Contracting by Negotiation (FAR 15)
• IDIQ (FAR 16.5)
– SATOC
– MATOC (Army)
– MAC (Navy and Air Force)
Determining the Procurement Method
6.401 -- Sealed Bidding and Competitive
Proposals.
• Sealed bidding and competitive proposals, as
described in Parts 14 and 15, are both acceptable
procedures for use under Subparts 6.1, 6.2; and,
when appropriate, under Subpart 6.3.
Procurement Methods
(a) Sealed bids. (See Part 14 for procedures.) Contracting officers shall
solicit sealed bids if -• (1) Time permits the solicitation, submission, and evaluation of sealed
bids;
• (2) The award will be made on the basis of price and other pricerelated factors;
• (3) It is not necessary to conduct discussions with the responding
offerors about their bids; and
• (4) There is a reasonable expectation of receiving more than one
sealed bid.
Procurement Methods (cont.)
(b) Competitive proposals. (See Part 15 for procedures.)
• (1) Contracting officers may request competitive proposals if sealed
bids are not appropriate under paragraph (a) above.
• (2) Because of differences in areas such as law, regulations, and
business practices, it is generally necessary to conduct discussions
with offerors relative to proposed contracts to be made and performed
outside the United States and its outlying areas. Competitive proposals
will therefore be used for these contracts unless discussions are not
required and the use of sealed bids is otherwise appropriate.
Contracting for Construction
FAR 36.103 -- Methods of Contracting.
• (a) The contracting officers shall use sealed
bid procedures for a construction contract if
the conditions in 6.401(a) apply, unless the
contract will be performed outside the
United States and its outlying areas. (See
6.401(b)(2).
Determining the Contract Type
FAR 16.101(a) A wide selection of contract types is available
to the Government and contractors in order to provide
needed flexibility in acquiring the large variety and volume of
supplies and services required by agencies. Contract types
vary according to -• (1) The degree and timing of the responsibility assumed by
the contractor for the costs of performance; and
• (2) The amount and nature of the profit incentive offered to
the contractor for achieving or exceeding specified
standards or goals.
Type of Contracts
FAR Part 16
• Firm Fixed-Price
• Cost Reimbursable
• Indefinite Delivery Contract
(Includes IDIQ) [MATOC]
• Set Asides?
Firm Fixed-Price
FAR 16.103(b) - (b) A firm-fixed-price contract,
which best utilizes the basic profit motive of
business enterprise, shall be used when the risk
involved is minimal or can be predicted with an
acceptable degree of certainty. However, when a
reasonable basis for firm pricing does not exist,
other contract types should be considered, and
negotiations should be directed toward selecting a
contract type (or combination of types) that will
appropriately tie profit to contractor performance.
Small Business Set Aside?
What is a Small Business?
Construction – Revenue Based NAICS Code
Manufacturing – Number of Employees
Small Business Types
• “Regular” Non-Disadvantaged “Small” Business
• Small Disadvantaged 8(a)
• HUBZone
• Service Disabled Veteran-Owned Small Business (“SDVOSB”)
• Woman-Owned Small Business (“WOSB”)
Rule of Two
In Delex Systems, Inc. (Oct. 8, 2008,
http://www.gao.gov/decisions/bidpro/400403.pdf), GAO
expanded the reach of FAR 19.502-2(b), which requires an
agency to limit competition to small businesses when it
concludes it has a reasonable expectation of receiving offers
from at least two responsible small businesses and award
can be made at a fair and reasonable price.
GAO held that the so-called "Rule of Two" applies to task
and delivery order competitions among multiple-award
contract holders, opening up a new class of award decisions
to the small business set-aside requirements and potential
bid protests.
Rule of Two
Kingdomware Technologies, Inc. v. The United States
COFC Case No. 12-173C
•
Interpreted the a statute known as the Veterans Benefits, Health Care, and
Information Technology Act of 2006, 8 U.S.C. §§ 8127-28.
•
Kingdomware Technologies and Aldevra claimed that the VA failed to conduct
the required “rule of two” investigation and used Federal Supply Schedule (“FSS”)
instead.
•
VA argued that they did not HAVE to conduct rule of two analysis.
•
GAO sides with Protestors
Rule of Two
Kingdomware Technologies, Inc. v. The United States
•
COFC sides with VA
– Found that the Act didn’t require the VA to consider setting aside procurements for
SDVOSBs or VOSBs when the FSS could be used instead. Even though the Act uses
the phrase “shall award,” the COFC emphasized that this phrase had to be read in
conjunction with other terms of the Act, which – in the COFC’s view-- demonstrated
that the Act was only “goal-setting in nature.” In other words, the rule of two
investigation was not mandatory.
– The COFC reasoned that “the 2006 Act must be construed in light of its goal-setting
provisions and thus the statute is at best ambiguous as to whether it mandates a
preference for SDVOSBs and VOSBs for all VA procurements.” Based on this reading
of the Act, the COFC held that the VA had broad discretion with regard to set-aside
procurements; the VA was not required to consider setting aside the procurements
at issue.
Rule of Two
Kingdomware Technologies, Inc. v. The United States
•
COFC sides with VA
– Found that the Act didn’t require the VA to consider setting aside procurements for
SDVOSBs or VOSBs when the FSS could be used instead. Even though the Act uses the
phrase “shall award,” the COFC emphasized that this phrase had to be read in conjunction
with other terms of the Act, which – in the COFC’s view-- demonstrated that the Act was
only “goal-setting in nature.” In other words, the rule of two investigation was not
mandatory.
– The COFC reasoned that “the 2006 Act must be construed in light of its goal-setting
provisions and thus the statute is at best ambiguous as to whether it mandates a
preference for SDVOSBs and VOSBs for all VA procurements.” Based on this reading of the
Act, the COFC held that the VA had broad discretion with regard to set-aside
procurements; the VA was not required to consider setting aside the procurements at
issue.
•
Federal Circuit Affirmed COFC.
Sealed Bidding
Invitation for Bids (“IFB”)
Award is Made to the Lowest Responsive and
Responsible Bidder
Common Issues in Sealed Bidding
• Restrictions on Competition
• “Bid it as you see it”
• Errors and Omissions
• Timeliness
• Mistake in Bid
Contracting By Negotiation
Request for Proposals (“RFP”)
Award is Made to the Offeror who Presents the “Best Value”
Tradeoff Process
Lowest Price Technically Acceptable (‘LPTA”)
Evaluation Factors
The award decision is based on evaluation factors and
significant subfactors that are tailored to the acquisition.
Evaluation factors and significant subfactors must –
(1) Represent the key areas of importance and emphasis
to be considered in the source selection decision; and
(2) Support meaningful comparison and discrimination
between and among competing proposals.
Typical Evaluation Factors
•
Management Organization
•
Proposed Technical Approach/Solutions
•
Proposed Schedule
•
Technical Experience and Expertise
•
Key Personnel Qualifications
•
Past Performance
•
Experience with similar types of work
•
Small Business Subcontracting Plan
•
Price
Award on Initial Proposals
There is generally no obligation for an agency to
conduct discussions where…the RFP specifically
instructs offerors of the agency’s intent to award a
contract on the basis of initial proposals…The
Contraction Officer’s discretion in deciding not to hold
discussions is quite broad. Our office [the GAO] will
review the exercise of that discretion only to ensure
that it was reasonable based on the particular
circumstances of the procurement. HDL Research
Lab, Inc., B-294959, Dec. 21, 2004 citing FAR 15.306
(a)(3), and Colmek Sys. Eng., B-291931.2, July 9,
2003.
Opening Negotiations
• Clarifications and award without
discussions
• Competitive Range
• Negotiations are “discussions” with all
offerors within the competitive range.
Negotiations Defined
• Negotiations are discussions (“exchanges”), in
either a competitive or sole source environment,
between the Government and offerors, that are
undertaken with the intent of allowing the offeror to
revise its proposal.
• “Exchanges” is a shifting definition
Purpose of Negotiations
• The primary objective of discussions is to
maximize the Government’s ability to obtain best
value, based on the requirement and the
evaluation factors set forth in the solicitation.
• At a minimum, the contracting officer must
indicate to, or discuss with, each offeror still being
considered for award, deficiencies, significant
weaknesses, and adverse past performance
information to which the offeror has not yet had an
opportunity to respond.
Negotiations May Include
Negotiations may include bargaining.
Bargaining includes persuasion, alteration
of assumptions and positions, give-andtake, and may apply to price, schedule,
technical requirements, type of contract, or
other terms of a proposed contract.
Limits on Negotiations
• Government personnel may not engage in conduct that –
– Favors one offeror over another
– Reveals an offeror’s technical solution, including unique
technology, innovative and unique uses of commercial items,
or any information that would compromise an offeror’s
intellectual property to another offeror
– Reveals an offeror's price without that offeror’s permission
– Reveals the names of individuals providing reference
information about an offeror’s past performance
– Knowingly furnishes source selection information
Final Proposal Revision
The contracting officer may request or allow
proposal revisions to clarify and document
understandings reached during negotiations. At
the conclusion of discussions, each offeror still in
the competitive range shall be given an
opportunity to submit a final proposal revision.
The contracting officer is required to establish a
common cut-off date only for receipt of final
proposal revisions.
Next Steps
• Review of Bids/Proposals and Contract
Award
• Protests?
• Performance
• Claims
Contact Information
Maria L. Panichelli, Esq.
mpanichelli@cohenseglias.com
@MariaPanichelli (twitter)
www.fedconblog.com
www.linkedin.com/in/mariapanichelli/
Jennifer M. Horn, Esq.
jhorn@cohenseglias.com
@HornJM (twitter)
www.constructionlawsignal.com/
59
Thank You For Participating
Following this call you will receive links to the podcast of
this session, along with a brief survey.
Your feedback is important to us! Please take a moment to
fill out the survey so that we can bring you the best
training possible.
•
•
•
•
Get Involved!
Join a policy issue committee and learn how policy can impact your business growth
Make your voice heard - become a member of our national Instant Impact Advocacy
Team
Participate in our educational series – unlimited opportunities for you and your staff
Receive weekly policy updates and briefings
1-888-488-WIPP
www.wipp.org
Questions? Contact WIPP Staff
Program & Education Coordinator: Lin Stuart▪ LStuart@wipp.org ▪ (415) 434-4314
Membership Coordinator: Lynn Bunim ▪ Lbunim@wipp.org ▪ (415) 434-4314