1. 1 Presented by: Mr. Chip Summers (703) 805-5151 Contracting: New Initiatives/Issues

2. 2 New Initiatives/Issues Organizational Conflict of Interest Due to activities or relationships, a person is unable to render impartial assistance or advice to the Government Or a person’s objectivity in performing the contract is or might be impaired Or an unfair competitive advantage exist 1

3. 3 New Initiatives/Issues Organizational Conflict of Interest Systems engineering & technical direction Preparing specifications or work statements Providing evaluation services Obtaining access to proprietary information

4. 4 New Initiatives/Issues Incentives DoD reconsiders bonus system What motivates contractors Subjective vs Objective Types –Cost –Schedule –Performance –Multiple 1A

5. 5 New Initiatives/Issues Contractor Cost Sharing Concern about financial health of Def Industry Permit contractors to earn reasonable profit Not acceptable for contractors to fund Gov development programs (DODD 5000.1) 2

6. 6 New Initiatives/Issues Performance Based Payments Preferred method for financing Expanded to R&D and competitive fixed price acquisitions Goals –FY 02 – 25% –By FY 05 most prevalent Guide Book available DoD IG Critical 2A

7. 7 New Initiatives/Issues MAS Service Contracts Concern with lack of competition Purchases of services > $100K made on competitive basis Notice to as many contractors as practicable to ensure 3 responses or D&F(all must be contacted if not FSS) Implements Section 803 of FY 02 Authorization Act Education requirements-only in rare occasions Task & Delivery Order contracts – 5 years max 3

8. 8 Supply –GSA Advantage or review catalogs or price list of at least 3 schedule contractors. –Select the Best Value Contractor –Ref: FAR 8.4 ; www.gsaAdvantage.govwww.gsaAdvantage.gov Service –Under $100K same as for supply –Over $100K (Sec 803, FY02 Def Auth Act) Provide Notice to as many contractors as practicable Receive offers from at least 3 qualified contractors or CO determines in writing that additional contractors could not be identified. New Initiatives/Issues FSS Competition

9. 9 New Initiatives/Issues Small Business Bundling –OSD commitment to small bus (Jan 02 Memo) –SADBU Guide on benefit analysis –Mandatory document at Milestone B –FAR requires coordination with SADBUS if >$7M –Agency may determine justified if savings would be substantial (10% $75M) 4

10. 10 New Initiatives/Issues Commercial Emphasize performance based requirements to enable commercial firms to compete Establish goals and eliminate barriers Use FAR Part 12 to maximum extent Commercial Item Handbook Contract Type –FFP or FFP/EPA –Can use incentives if based on other than cost factors 5B

11. 11 New Initiatives/Issues Performance Based Service Acquisitions Service contracting is growing Movement from how to to outcomes Cost savings Downsizing the Gov work force Treated as commercial if < $500K 50% PBSA by 2005/ 80% by 2008 Savings goals (FY02 Auth Act) –5% by 04/ 10% by 2011 DoD prohibits acq of services not performance based without special approval 6

12. 12 New Initiatives/Issues Unique Identification of Items Contracts shall require that all items delivered to the Gov > $5000 –Be delivered under a CLIN or Sub CLIN –Contain unique item identification or a DoD recognized equivalent UID is a mandatory DoD requirement for all solicitations issued after Jan 1, 2004 7

13. 13 Back-up

14. 14 Selecting the Source Alpha /One Pass Alpha /One Pass

15. 15 Field Pricing Tech Eval DCAA Audit Pre-Negotiation Objectives Price Negotiation Memorandum Write Contract Reviews PCO Signs Distribution Selecting the Source Traditional Approach (Non-Competitive) Negotiations Proposal Contractor Signs Contracto r Government Contractor and Government Legend

16. 16 Selecting the Source Alpha/One Pass Relies on a Team Approach To concurrently develop a scope of work Price that scope of work Prepare a contract to execute that scope of work http://www.acq-ref.navy.mil/

17. 17 Selecting the Source Alpha/One Pass (Sole Source) Requirement Acquisition Strategy Processes Team Members Acquisition Plan Model Contract Technical & Cost Agreements Contractor and Government Sign Distribution Reviews Contractor and Government Separately Government Contractor and Government Legend

18. 18 Selecting the Source Alpha/One Pass – Keys to Success Management Commitment Trust Honesty Empowerment