POLICY AND OVERSIGHT DIVISION (POD) February 2014 Documentation of Evaluation for Award 1

Overview In FY 2013, POD performed Acquisition Management Reviews (AMR) of NOAAs Acquisition and Grants Office (AGO). To assist the Acquisition Divisions (AD), POD has developed training to address findings from the AMRs. This training will identify negative trends found in AD conduct and documentation of evaluation of offers for award. 2

Objectives Cite Federal Acquisition Regulation (FAR) requirement for establishing and maintaining complete contract files. Cite policy on performance and documentation of the evaluation of offers for award. Identify negative trends in evaluation of offers for award. 3

Requirement for Establishing Contract Files (FAR 4.801) General. (a) The head of each office performing contracting, contract administration, or paying functions shall establish files containing the records of all contractual actions. (b) The documentation in the files (see 4.803) shall be sufficient to constitute a complete history of the transaction for the purpose of4.803 (1) Providing a complete background as a basis for informed decisions at each step in the acquisition process; (2) Supporting actions taken; (3) Providing information for reviews and investigations; and (4) Furnishing essential facts in the event of litigation or congressional inquiries. (c) The files to be established include... a file for each contract. 4

Contents of Contract Files (FAR 4.803) Contents of contract files. The following are examples of the records normally contained, if applicable, in contract files: (a) Contracting office contract file:... (13) Source selection documentation.... (19) Cost or price analysis.... (21) Record of negotiation. 5

Required Proposal Evaluation Documents (FAR 15.3, FAR 15.4, CAM ) Technical evaluation report Record of cost/price evaluation Determination on need for negotiations or award without them Competitive range determination Record of negotiations held Price negotiation memorandum or other record of price fair and reasonableness determination 6

Negative Trends Identified No evidence of technical/price evaluations being performed. Technical and price evaluations in contract files lacking sufficient detail to support decisions made. Lack of documentation on negotiations (e.g., determination on need for negotiations, competitive range determination made, record of negotiations held). Price fair and reasonableness determinations for contracts, orders, and modifications either missing or lacking sufficient facts to support the action. 7

Evaluation and Award (Simplified Acquisitions) (FAR ) The contracting officer shall evaluate quotations or offers in an impartial manner. Quotations or offers shall be evaluated on the basis established in the solicitation. All quotations or offers shall be considered. Purchasing offices shall retain data supporting purchases for management review purposes. Before making award, the contracting officer must determine that the proposed price is fair and reasonable. 8

Proposal Evaluation (Source Selections) (FAR 15.3) An agency shall evaluate competitive proposals and then assess their relative qualities solely on the factors and subfactors specified in the solicitation. Award may be made without discussions if the solicitation states that the Government intends to evaluate proposals and make award without discussions. If the Government determines it necessary to conduct discussions, the rationale for doing so shall be documented in the contract file. 9

Proposal Evaluation (Source Selections) (FAR 15.3) (Contd) Agencies shall evaluate all proposals in accordance with (a), and, if discussions are to be conducted, establish the competitive range Price or cost to the Government shall be evaluated in every source selection. Past performance shall be evaluated in all source selections for negotiated competitive acquisitions expected to exceed the simplified acquisition threshold, unless excepted by the contracting officer. 10

11 Contract Pricing (FAR 15.4) Contracting officers shall purchase supplies and services from responsible sources at fair and reasonable prices. The contracting officer is responsible for evaluating the reasonableness of the offered prices. Various analytical techniques and procedures may be used, singly or in combination with others, to ensure that the final price is fair and reasonable The objective of proposal analysis is to ensure that the final agreed-to price is fair and reasonable.

Examples of Price Analysis Techniques (FAR ) Comparison of proposed prices received in response to the solicitation. Comparison of the proposed prices to historical prices paid. Comparison of proposed prices with independent Government cost estimates. Comparison with competitive published price lists, published market prices of commodities, and similar indexes. Comparison of proposed prices with prices obtained through market research for the same or similar items. 12

Examples of Cost Analysis Techniques (FAR ) Verification of cost data or pricing data and evaluation of cost elements. Evaluating the effect of the offerors current practices on future costs. Comparison of costs proposed by the offeror for individual cost elements with: Actual costs previously incurred by the same offeror; Independent Government cost estimates by technical personnel; Other cost estimates received in response to the Governments request. 13

Competitive Range Determination (FAR ) Agencies shall evaluate all proposals in accordance with (a), and, if discussions are to be conducted, establish the competitive range

Documentation of Negotiations (FAR ) The contracting officer shall establish prenegotiation objectives before the negotiation of any pricing action. When cost analysis is required, the contracting officer shall document the pertinent issues to be negotiated, the cost objectives, and a profit or fee objective The contracting officer shall document in the contract file the principal elements of the negotiated agreement. 15

Conclusion Inclusion of clear and complete documentation in contract files is essential to: Furnish pertinent facts used as a basis for informed decisions at each step in the acquisition process; Document the rationale for actions taken; Provide a complete audit trail that may be used to support reviews and future investigations, litigation, or congressional inquiries; Substantiate that good business decisions were made. 16

Questions? 17