Procurement Management Review (PMR) Process

1. Procurement Management Review (PMR) Process March 5, 2014

2. Overview • Purpose • How it Works • Review Topics • Review Findings • Tips

3. Purpose • The amount of NASA’s annual budget devoted to acquisitions make it essential for the Headquarters (HQ) Office of Procurement (OP) to maintain a continuing program for periodic oversight of contracting activities across the Agency. PMRs serve as an element of the Agency’s requirement to maintain internal control and review of its operations.

4. How It Works • HQ OP usually runs 3-4 PMRs per year. • GSFC’s PMR occurs every other year. • Smaller Centers occur every 3-years. • Next PMR for GSFC is scheduled for August 2014 • The PMR Team is made up of a Team Lead from HQ OP and membership across the agency including HQ. (Virtual PMR Process is now being utilized where files are reviewed remotely.) • HQ Office of Small Business Programs always holds their review of the Center’s Small Business Programs in conjunction with the PMR.

5. How It Works • Topics • There are set topics that are always reviewed during each PMR in the following High Level Areas: Organization – Management; Pre-Award Processes and Documentation; Post-Award Processes and Documentation; Pricing-Financial-Audits; and Other Issues. (For a full list of Topics see backup) • PMR Manager will interview Procurement Employees, Technical Customers, and Chief Counsel in order to determine the overall health of the Organization. • Files are chosen by determining what contracts were awarded since the previous PMR. • Special Emphasis is placed on Repeat Weaknesses

6. Review Topic Examples • JOFOCs • Ensure JOFOC is approved at the appropriate level. Verify any JOFOCs for unusual & compelling urgency were forwarded to HQ upon completion. • Ensure JOFOC contains good rationale and content required by the FAR. • Determine whether contract actions (e.g., modifications) issued after JOFOC approval are proper (i.e., not subject to competition and falls within scope). Determine whether contract action requires an amended JOFOC (e.g., for greater than nominal dollar value increase above JOFOC approved value or if increase causes total to exceed prior approval authority level).

7. Review Topics • Pre-Post Negotiation Memorandum • Review for compliance with FAR 15.406 and NFS 1815.406. • Ensure appropriate signatory level received. • Ensure each element of cost is addressed and includes as applicable audit support or rate agreements as a basis for establishing negotiation objectives. Ensure documentation includes as applicable detail to support how government maximum position was determined, particularly in cases when a proposed cost element was identical to the corresponding maximum position cost element. PIC 00-04 provides guidance that states that the maximum position reached should not be “lightly supported” and states that both objective and maximum positions should be “explained in detail in the PPM for each element (cost or profit/fee) involved.” • Ensure appropriate use of standalone PPM/PNM and examine against Center policy. • Follow-up on prior PMR consideration relative to providing detailed rationale to support final negotiations of each cost element that exceeds the government objective or reaches the government maximum position (ref PIC 00-04).

8. Review Topics • Simplified/Commercial Acquisitions • Ensure FAR 13 price reasonableness determination is made; ensure tech evaluations are conducted as necessary. • Note that simplified acquisition threshold increased to $150K effective Oct. 1, 2010. Review FAR 13 acquisitions utilizing up to $5.5M commercial item test program ($6.5M effective Oct. 1, 2010). Section 822 of the National Defense Authorization Act (NDAA) for Fiscal Year 2013, Public Law 112-239 extended the test program until January 1, 2015. • Ensure appropriate terms & conditions for FAR Part 13 and FAR Part 12 acquisitions are included; Note that as a result of recent FAR change that now categorizes GSA/FSS orders as Interagency Agreements, with those over $500k having to meet FAR 17.5 requirements, review those under $500k for this area

9. Review Findings • Interviews and Compliance Reviews are Compiled into Strengths, Weaknesses, Recommendations and Considerations • Strengths are generally defined as efforts which surpass the basic requirements of particular procurement actions and/or processes. • Best Practices are processes and areas of excellence identified during the review that can be shared across Center and Agency procurement organizations to promote effectiveness and efficiency. • Weaknesses are defined as problems, typically systemic that require corrective actions. • Single or isolated problems do not result in Weaknesses but these isolated problems are maintained and given to the Procurement Officer on the side.

10. Review Findings • Recommendations are defined as issues that 1) are not necessarily systemic but may turn into problems if not addressed or 2) Require action by HQ OP such as policy development, clarification or updating. • Considerations are defined as issues that would result in better businesses practices if addressed. These are NOT included in the Report but are provided to the PO in a separate document.

11. Tips • Make sure our files are in good order NOW; the self-assessment will assist in this process. • During the PMR, if a review team member contacts you concerning your file, make sure you are responsive. This could result in clearing up any misunderstanding which could reduce findings. • The PMR is NOT an Audit but a Review process in order to improve the Overall Health of the Procurement Organization and in turn reduce Audit Findings when IG Audits occur.

12. Backup

13. Topics • Organization - Management • Organizational Structure and Staffing • Interviews • Review of procurement training and career development • Review of contracting officer representative training and delegations • Metrics Review and Documentation • Internal Policies and Procedures • Center Self-Assessment Program • Pre-Award Processes and Documentation • Master Buy Plan/Baseline Performance Review Actions • Justifications for Other Than Full and Open Competition • Acquisition Planning • Source Selection Process • Deviations and Waivers • Government Furnished Property • Contractor Safety Requirements

14. Topics • Post-Award Processes and Documentation • Pre-Negotiation and Post Negotiation Documentation • Contractor Performance Evaluation • Competition under Multiple Award and IDIQ contracts • Closeouts and Unliquidated Obligations • Undefinitized Contract Actions • Exercise of Options • Inter-Agency Agreements • Subcontract Consent • Pricing-Financial-Audits • Cost/Price Analysis including Use of Structured Approach in Profit/Fee Determinations • Technical Evaluations • Financial Management Reporting • Earned Value Management (when appropriate) • Audit Follow-up • Other Issues • Simplified/Commercial Acquisition Procedures • Purchase Card Program • Construction and Architect and Engineer Services Contracts • Environmental Issues • Grants and Cooperative Agreements (when appropriate) • Contract Management Module Implementation

15. Documents Found on the HQ OP Procurement Library • HQ OP Procurement Management Review Process • HQ OP Procurement Management Review Team Member Guide • Agency Best Practices