772 ESS Lesson Learned Briefing

1. Air Force Materiel Command 772 ESSLesson LearnedBriefing Mrs. Sally Kite 772 ESS/PKA 21 Aug 13 Integrity  Service  Excellence

2. From “The 100 Worst” From “The 100 Worst Mistakes in Government Contracting” (NCMA 2008) • Solicitation • Proposal Preparation and Submission • Defective Pricing and Truth in Negotiations Act • Subcontract Management • Contract Administration • Contract Disputes

3. Solicitation Failure to Read Solicitation – “read it again, and again, and again” • Due Date & Time/Delivery Instructions/Comply/Ask ??s Failure to Consider all Subsequent Amendments • Read, consider, and formally acknowledge all amendments as part of the offer • Read solicitation to see if there are updates that you are responsible for (i.e. Davis-Bacon) • Material amendments must be formally acknowledged Failure to Question Patent Ambiguities • Scour the solicitation for ambiguities prior to submission of offer • Contractor has duty to seek clarification • Patent vs. Latent Relying on Verbal vs. Written Instructions • Not binding w/few exceptions (micropurchases, simplified acquisitions etc.) Failure to Request a Debrief • Request in timely fashion per guidance (i.e. FAR) • Learning Experience

4. Proposal Preparation and Submission Failure to Follow Instructions • Comply w/everything Base Offer on Evaluation Factors • All factors/subfactors along w/relative importance will be stated in RFP Submit Offer on Time • Get a receipt - if electronic – ask for read receipt • Allow for base access time (if applicable) Violating Limitations on Subcontracting (FAR 52.219-14) • Services 50%, Supplies 50%; GC 15%, Construction (special trade) 25% Expectation that Government will Hold Discussions Failure to Understand the Importance of Past Performance • Must be considered in every solicitation over SAT • All relevant information may be considered even if not provided directly by offeror

5. Defective Pricing and Truth in Negotiations Act Failure to Understand Cost or Pricing Data Truth in Negotiations Act (TINA) • Requires contractors to furnish cost or pricing data before an agreement on price for most negotiated procurements >$700,000. Cost or Pricing Data • All facts prudent buyer would reasonably expect to significantly affect price negotiations that were available at the time the contract’s price was agreed to. • Must be certified as “accurate, current, and complete” as of date price agreed upon Other than cost or pricing data • Appropriate information on the prices at which same or similar items have previously sold, and are adequate for determining reasonableness of price • Less onerous on the contractor Defective cost or pricing • Law provides for price reductions

6. Subcontract Management Failure to Flow Down FAR Clauses to Subcontractors Lessons Learned • Pricing Arrangements • Prompt Payment • Notice of Withholding • Retainage • Manage your subcontractor/suppliers – gov’t would prefer not too Failure to Include a Disputes Clause in the Subcontract • Recommend that prime include specifically tailored dispute clause in subcontract, including a statement that the subcontractor must continue performance as directed by the prime contractor during the pendency of the dispute. • Procedures for resolving disputes • Forum for Appeal

7. Contract Administration Accepting Direction from Unauthorized Government Officials • Only Contracting Officer has authority • Ask for written delegation of authority • Ask for direction in writing • Courts historically find against contractor and deny claim if a contractor takes direction form someone without authority Following Oral Promises vs. the Written Contract • Only the written word is binding • Reliance on oral advice from unauthorized gov’t officials is at contractor’s risk and the government is not bound by risk Failure to Comply with Quality Control/Quality Assurance in the Contract • Contractor is responsible for quality control/quality assurance • Government is entitled to insist on strict compliance w/contract specifications and may order the correction of nonconforming work at no additional cost to gov’t

8. Contract Administration Continued Failure to Deliver on Time = Serious Consequences • Loss of current contract (i.e. T4D) • Liability for excess re-procurement costs • Loss of future contracts (i.e. negative past performance) Failure to Submit a Proper Invoice • Understand payment procedures and what constitutes a proper invoice • Government will only pay proper invoices (Prompt Payment generally requires Gov’t to reject within 7 and pay proper invoice within 30 days) • Payment clauses applicable to contract normally very specific on format • Subcontractors must be paid within 7 days of prime receiving payment Incurring Cost Before the Contract is Signed Failure to Pay the Minimum Wage Benefits Required • Federal constructino over $2,000 or service contracts over $2,500 are required to include minimum wage and fringe benefits • Wages also apply to subcontractors Failure to Comply with the Limitations of Funds Clause

9. Contract Disputes Failure to Submit a Proper Claim • Proper claim must be in writing to CO • Must request final decision • Must be properly certified if over $100,000 • Must include sum certain (cannot state “no more than, no less than”) Failure to Request an Equitable Adjustment When Warranted • Recommend requesting REA prior to submitting claim • If over $100,000 – must certify • CO has “reasonable period” to respond