Georgia Tech Procurement Assistance Center

Discussions vs. clarifications vs. communications — and agency discretion

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Words have special meanings in federal contracting.

Here’s a description of how “discussions” differ from “clarifications” and pre-competitive range communications, as well as the Government’s discretion to conduct (or not conduct) such “exchanges.”

Discussions are exchanges between the Government and offerors after a competitive range has been established and invite or permit offerors to revise their proposals.  The underlying purpose of discussions is to allow offerors to strengthen their proposals and the procuring agency to get a better deal.  The Government Accountability Office (GAO) has long held that the “acid test” for determining if a particular exchange constitutes discussions is “whether the agency has provided an opportunity for proposals to be revised or modified.”  Raytheon Co., B‑404998, July 25, 2011, 2011 CPD ¶ 232 at 5.  This may be an actual pen-and-paper change to the proposal, or any other exchange that is necessary for the agency to determine the acceptability of a proposal.  See Int’l Waste Indus., B-411338, July 7, 2015, 2015 CPD ¶ 196 at 5.

Clarifications, on the other hand, are “limited exchanges.”  FAR 15.306(a)(1).  These exchanges do not allow offerors to revise their proposals, but may allow them to clarify certain aspects of their proposals or resolve minor clerical errors.  FAR 15.306(a)(2).  Clarifications may occur after a competitive range has been established, or even when discussions and proposal revisions are not contemplated at all.  Clarifications “cannot be used to cure proposal deficiencies or material omissions, materially alter the technical or cost elements of the proposal, and/or otherwise revise the proposal.”  STG, Inc., B-411415; B-411415.2, July 22, 2015, 2015 CPD ¶ 240 at 9.

Communications are a third category of exchanges and occur before the competitive range has been established.  See FAR 15.306(b).  Like clarifications, they do not allow offerors “to cure proposal deficiencies or material omissions, materially alter the technical or cost elements of the proposal, and/or otherwise revise the proposal.”  FAR 15.503(b)(2).  They are intended only to permit the Government to improve its understanding of proposals or past performance information, and address minor issues before a competitive range is established.  When adverse past performance information to which the offeror has not yet had an opportunity to respond would be the “determining factor” in excluding the offeror from the competitive range, the agencymust open communications with the offeror to address that information.  FAR 15.306(b)(1)(i).  For all other issues, the agency may hold communications if an offeror’s “exclusion from, or inclusion in, the competitive range is uncertain.”  FAR 15.306(b)(1)(ii).

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=653680

Latent ambiguities and non-apparent solicitation defects

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Having discussed protest grounds you cannot or should not raise ( here and here), we turn now to the first in a series of grounds that could result in a sustained protest: Latent Ambiguities and Non-Apparent Solicitation Defects.

We’ve previously noted the rule that, to challenge the terms of a solicitation, a protester generally must do so before the date set for receipt of proposals.  This rule is designed to prevent companies from rolling the dice on a bid and then, after they lose, complaining to the GAO about how messed up the solicitation was.  If an offeror submits a proposal against a solicitation it thought was unfair, unclear, or otherwise defective without first objecting, the GAO (and the Court of Federal Claims, for that matter) won’t show any sympathy in a post-award protest.  That’s what pre-award protests are for.

There is, however, an important exception to this rule.  The GAO’s regulation on protests due before the time set for receipt of proposals applies only to “[p]rotests based upon alleged improprieties in a solicitation which are apparent prior to bid opening or the time set for receipt of initial proposals [or revised proposals, for apparent improprieties introduced by an amendment].”  4 C.F.R. § 21.2(a)(1) (emphasis added).  If a solicitation impropriety is not “apparent” until after proposals have been submitted, then the 10-day timeliness clock applies instead.  4 C.F.R. § 21.2(a)(2).

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=634686

When is an unforeseen condition a ‘differing site condition’?

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I was reviewing various articles I have written over the years and came across a prior version of this one about differing site conditions, written nearly twenty years ago.   I was curious – does this cup still hold water?

It does.

Many construction contracts contain some version of a “differing site conditions” clause.   It is found in the current version of AIA’s A201 general conditions, as well as in the EJCDC equivalent.   It also appears in most state DOT specifications, as well as in federal government construction contracts.   Generally, it provides for a change order (subject to procedural compliance) when the contractor encounters (i) subsurface or other concealed conditions that differ materially from the conditions indicated by the contract documents or (ii) unknown physical conditions of an unusual nature differing materially from those ordinarily encountered and recognized as inherent to the work provided for in the contract documents.   But, as they say, “timing is everything.”   This adage applies, too, to a differing site conditions claim.

In Olym­pus Corp. v. United States, 98 F.3d 1314 (Fed. Cir. 1996), the United States Federal Circuit Court of Appeals was confronted with the following ques­tion: Are delays caused by a govern­ment caused hazardous materi­als spill compensable under the federal Differing Site Condi­tions clause?  The court an­­­­­s­wered “no” based on its con­clusion that to be con­sidered a differing site con­dition, the condition must exist at the time the contract was formed.

Olympus entered into a fixed price contract with the United States to pave the plant yards at the Stratford Army Engine Plant located in Strat­ford, Connecticut. As man­­­­­­­­­­­­­dated by the Federal Acquisition Regulation, 48 C.F.R. ‘ 52.236-3 (1995), the contract contained a standard Differing Site Conditions clause which provided, in part, for an equitable adjustment, upon notice, of  “subsurface or latent physical conditions at the site which differ materially from those indicated in [the] contract.”

Keep reading this article at: http://www.jdsupra.com/legalnews/when-is-an-unforeseen-condition-a-73987/

DoD Inspector General publishes list of post-award fraud indicators

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On July 29, 2015, the Office of the Inspector General for the Department of Defense (OIG DoD) published on its website new “Contract Audit Fraud Scenario and Indicators for Material Pricing Deficiencies in a Postaward Audit.”   While this tool – and several others posted on the Defense IG’s website – is designed to be used primarily by Defense Contract Audit Agency (DCAA) auditors to identify possible fraud, it also provides valuable insight for government contractors subject to DCAA audits.

DoD OIGBy knowing the indicators of fraud that government auditors are looking for, contractors can be better prepared for further inquiry and investigation if the facts and circumstances of their postaward audit raise these types of “red flags.” Further, many of the fraud scenarios and indicators that DoD IG identifies are of a general nature and could be found in any type of audit.

In a postaward audit to determine if materials were DoD Fraud Hotlinedefectively priced, the government’s auditors are alert to circumstances that might indicate fraud, thus requiring them to make a referral to a criminal investigator. The result could be further investigation that exposes the company to criminal, civil and/or administrative liability. The IG identifies 11 fraud indicators that DCAA auditors should be on the lookout for in defective pricing audits.

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=417358

 

 

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