FEDERAL CONTRACTS PERSPECTIVE
Federal Acquisition Developments, Guidance, and Opinions
Vol. XIV, No. 9
FAC 2005-69 Establishes Standardized Past Performance Evaluation Factors and Ratings
Contractors Have 14 Days to Comment on Performance Evaluations
DOD Proposes “Overarching Prescriptions” for Clauses with Alternatives
GSA Launches Online IT Solutions Navigator
VA Extends SDVOSB/VOSB Re-Verification to 2 Years
FAC 2005-69 Establishes Standardized Past
Performance Evaluation Factors and Ratings
Federal Acquisition Circular (FAC) 2005-69 revises the Federal Acquisition Regulation (FAR) provide governmentwide standardized past performance evaluation factors and performance ratings, and to require all past performance information be entered into the Contractor Performance Assessment Reporting System (CPARS). In addition, FAC 2005-69 contains rules revising the definition of “contingency operations,” sanctions against Iran, protests of certain task and delivery order contracts, least developed countries that are designated countries, and biobased reporting requirements.
- Documenting Contractor Performance: This final rule amends FAR subpart 42.15, Contractor Performance Information, to provide governmentwide standardized past performance evaluation factors and performance ratings, and to require all past performance information be entered into the Contractor Performance Assessment Reporting System (CPARS), the governmentwide past performance feeder system (http://www.cpars.gov/).
The original proposed rule would have amended FAR subpart 42.15 to: (1) add language to FAR 42.1501, General, to require the use of CPARS as the governmentwide past performance information feeder system into the Past Performance Information Retrieval System (PPIRS) (http://www.ppirs.gov/); and (2) add language to FAR 42.1503, Procedures, that would specify the governmentwide standard evaluation factors (technical or quality; cost control [as applicable]; schedule/timeliness; management or business relations; and small business subcontracting [as applicable]) and a five scale rating system (exceptional, very good, satisfactory, marginal, and unsatisfactory) that reflects the rating definitions contained in the CPARS Policy Guide (available at http://www.cpars.gov/cparsfiles/pdfs/CPARS-Guidance.pdf).
Twenty-three respondents submitted comments on that proposed rule. While addressing the comments, Congress passed the Defense Authorization Act for Fiscal Year 2012 (Public Law 112-81). Section 806, “Inclusion of Data on Contractor Performance in Past Performance Databases for Source Selection Decisions,” requires: (1) establishment of standards for the timeliness and completeness of past performance submissions for purposes of databases; (2) assignment of responsibility and management accountability for the completeness of past performance submissions for such purposes; and (3) assurance that past performance submissions are consistent with award fee evaluations in cases where such evaluations have been conducted. Therefore, a second proposed rule was issued, and 17 respondents submitted comments. While those comments were being addressed, Congress passed the Defense Authorization Act for Fiscal Year 2013 (Public Law 112-239). Section 853, Inclusion of Data on Contractor Performance in Past Performance Databases for Executive Agency Source Selection Decisions, addresses management accountability requirements. Therefore, this final rule incorporates changes in response to the comments on the two proposed rules and the Section 853 provisions.
To summarize, this final rule makes the following significant changes:
- FAR 42.1501, General, is amended to add paragraph (b), which requires agencies to “monitor their compliance with the past performance evaluation requirements (see 42.1502), and use the Contractor Performance Assessment Reporting System (CPARS) and Past Performance Information Retrieval System (PPIRS) metric tools to measure the quality and timely reporting of past performance information.”
- FAR 42.1502, Policy, is revised to clarify that “past performance evaluations shall be prepared at least annually and at the time the work under a contract or order is completed.”
- FAR 42.1503, Procedures, is revised as follows:
- Paragraph (b)(1) now states that “The evaluation should include a clear, non-technical description of the principal purpose of the contract or order. The evaluation should reflect how the contractor performed. The evaluation should include clear relevant information that accurately depicts the contractor’s performance, and be based on objective facts supported by program and contract or order performance data. The evaluations should be tailored to the contract type, size, content, and complexity of the contractual requirements.”
- Paragraph (b)(2) requires that each assessment include the following evaluation factors at a minimum:
- Technical (quality of product or service);
- Cost control (not applicable for firm-fixed-price or fixed-price with economic price adjustment arrangements);
- Management or business relations;
- Small business subcontracting (as applicable, see Table 42-2); [and]
- Other (as applicable) (e.g., late or nonpayment to subcontractors, trafficking violations, tax delinquency, failure to report in accordance with contract terms and conditions, defective cost or pricing data, terminations, suspension and debarments).
[EDITOR’S NOTE: This final rule adds the “other” evaluation factor to the original five factors which had been included in the original proposed rule.]
- Paragraph (b)(4) requires that each evaluation factor shall be rated in accordance with a five scale rating system (i.e., exceptional, very good, satisfactory, marginal, and unsatisfactory).
- Paragraph (c) requires that the incentive-fee contract performance evaluation be entered into CPARS when the contract provides for incentive fees, and that the award-fee contract performance adjectival rating shall be entered into CPARS when the contract provides for award fee.
- Paragraph (e) requires “frequent evaluation (e.g., monthly, quarterly) of agency compliance with the reporting requirements in 42.1502, so agencies can readily identify delinquent past performance reports and monitor their reports for quality control.”
- Paragraph (f) requires agencies to “prepare and submit all past performance evaluations electronically in the CPARS at http://www.cpars.gov/. These evaluations are automatically transmitted to PPIRS at http://www.ppirs.gov.”
- Following FAR 42.1503 are two tables: Table 42-1 – Evaluation Ratings Definitions; and Table 42-2 – Evaluation Ratings Definitions (for the Small Business Subcontracting Evaluation Factor, when [FAR] 52.219-9 [Small Business Subcontracting Plan] is used). Each evaluation factor must be rated using a five scale rating system (see FAR 42.1503(b)(4) above). For example, in Table 42-1, the “Exceptional” rating would be achieved when “Performance meets contractual requirements and exceeds many to the government’s benefit. The contractual performance of the element or sub-element being evaluated was accomplished with few minor problems for which corrective actions taken by the contractor were highly effective.” Also, the following “Note” explains how an “Exceptional” rating must be justified: “To justify an Exceptional rating, identify multiple significant events and state how they were of benefit to the government. A singular benefit, however, could be of such magnitude that it alone constitutes an Exceptional rating. Also, there should have been NO significant weaknesses identified.” Each of the five ratings in Table 42-1 and Table 42-2 have a “Definition” and a “Note.”
For more on the original proposed rule, see the July 2011 Federal Contracts Perspective article “FAR Rules on Prioritizing Supply Sources, Performance.” For more on the revised proposed rule, see the October 2012 Federal Contracts Perspective article “Standardized Performance Evaluation Factors Proposed.”
EDITOR’S NOTE: See the next article for more proposed changes to FAR 42.1503.
- Definition of “Contingency Operation”: This finalizes, without changes, the interim rule that revised the definition of “contingency operation” to address the statutory change to the definition made by Section 515 of the National Defense Authorization Act for Fiscal Year 2012 (Public Law 112-81).
Paragraph (a) of Section 515 incorporated a new provision, Section 12304a, Army Reserve, Navy Reserve, Marine Corps Reserve, and Air Force Reserve: Order to Active Duty to Provide Assistance in Response to a Major Disaster or Emergency, to United States Code Title 10, Armed Forces, Chapter 1209, Active Duty. Section 12304a provides for treatment of an operation as a contingency operation when the secretary of defense activates reserves under the terms of 10 U.S.C. 12304a in response to a governor’s request for federal assistance in responding to a major disaster or emergency declared by the president.
The interim rule added a reference to Section 12304a to the list of references in section (2) of “contingency operation” definition in FAR 2.101, Definitions ([“contingency operation” means a military operation that] “results in the call or order to, or retention on, active duty of members of the uniformed services under Sections 688, 12301(a), 12302, 12304, 12304a, 12305, or 12406 of Title 10 of the United States Code, Chapter 15 of Title 10 of the United States Code, or any other provision of law during a war or during a national emergency declared by the president or Congress” [emphasis added]).
One respondent submitted a concurrence with the interim rule, so the interim rule is finalized without changes. For more on the interim rule, see the March 2013 Federal Contracts Perspective article “FAC 2005-66 Extends FAR Subpart 13.5 Procedures, Addresses Raising T&M Ceiling Prices.”
- Iran Threat Reduction: This finalizes, with minor changes, the interim rule in FAC 2005-63 that amended FAR 25.703, Prohibition on Contracting with Entities That Engage in Certain Activities or Transactions Relating to Iran, to implement provisions of the Iran Threat Reduction and Syria Human Rights Act of 2012 (Public Law 112-158) that expand sanctions relating to the energy sector of Iran and sanctions with respect to Iran’s Revolutionary Guard Corps.
One respondent submitted a comment on the interim rule, but no changes were made in response to the comment. However, the final rule corrects the title of the act in paragraph (c) of FAR 25.700, Scope of Subpart, and corrects the website address of Acquisition Central from “https://www.acquisition.gov” to “http://www.acquisition.gov” in paragraph (a) of FAR 25.703-3, Prohibition on Contracting with Entities That Export Sensitive Technology to Iran, and paragraph (b)(2) of FAR 52.213-3, Offeror Representations and Certifications – Commercial Items.
For more on the interim rule, see the January 2013 Federal Contracts Perspective article “FAR Implements Iranian Sanctions.”
- Repeal of Sunset for Protests of Task or Delivery Order Contracts: This final rule implements Section 830 of the National Defense Authorization Act for Fiscal Year 2013 (Public Law 112-239), which removes the sunset date for protests against the issuance or proposed issuance of an order, valued at more than $10 million, under a task-order contract or delivery-order contract, for agencies subject to Title 10 of the U. S. Code only (that is, the Department of Defense (DOD), National Aeronautics and Space Administration (NASA), and the Coast Guard). In doing so, this authority to protest the placement of such orders placed by DOD, NASA, and the Coast Guard is made permanent. This rule does not affect agencies subject to Title 41 of the U.S. Code (that is, all civilian agencies except NASA); the sunset date for the authority to protest the placement of such orders will remain September 30, 2016, for them.
To implement Section 830, this final rule revises paragraph (a)(10)(ii) of FAR 16.505, Ordering [under indefinite-delivery contracts], to state, “The authority to protest the placement of an order under (a)(10)(i)(B) of this section expires on September 30, 2016, for agencies other than DOD, NASA, and the Coast Guard (41 U.S.C. 4103(d) and 41 U.S.C. 4106(f)). The authority to protest the placement of an order under (a)(10)(i)(B) of this section does not expire for DOD, NASA, and the Coast Guard.”
- Least Developed Countries That Are Designated Countries: This final rule implements a revision by the United States Trade Representative (USTR) to the list of least developed countries that are designated countries under the Trade Agreements Act of 1979.
The president is authorized to designate least developed countries as eligible countries under the Trade Agreements Act of 1979, thus allowing non-discriminatory treatment of the products of such countries in acquisitions subject to the World Trade Organization Government Procurement Agreement. This statutory authority has been delegated to the USTR. The USTR selects the countries for such designation from the United Nations (UN) Least Developed Countries List. The USTR has revised the list of least developed countries that are designated as eligible countries as follows:
- The name of East Timor is changed to Timor-Leste;
- The Maldives is removed from the list because it is no longer a least developed country; and
- South Sudan is added to the list. South Sudan seceded from Sudan to form an independent country on July 9, 2011, and was formally recognized as a least developed country by the UN in December 2012. Although the United States continues to impose sanctions against Sudan, South Sudan is not subject to sanctions.
To implement these changes, this final rule revises the definitions of “designated country” and “least developed country” in FAR 25.003, Definitions; FAR 52.225-5, Trade Agreements; FAR 52.225-11, Buy American Act – Construction Materials under Trade Agreements; and FAR 52.225-23, Required Use of American Iron, Steel, and Manufactured Goods – Buy American Act – Construction Materials Under Trade Agreements.
EDITOR'S NOTE: See the article below for DOD's implementation of the USTR revision to the list of least developed countries.
- Update to Biobased Reporting Requirements: This final rule revises FAR 52.223-2, Affirmative Procurement of Biobased Products Under Service and Construction Contracts, to require the contractor to submit the annual biobased report to the System for Award Management (SAM) website at http://www.sam.gov, instead of the agency environmental point of contact.
This final rule deletes paragraphs (c)(3) and (d) of FAR 52.223-2, which address the agency environmental point of contact, and revises paragraph (c)(1) to state, “Report to http://www.sam.gov, with a copy to the contracting officer, on the product types and dollar value of any USDA [U.S. Department of Agriculture]-designated biobased products purchased by the contractor during the previous government fiscal year, between October 1 and September 30...”
Contractors Have 14 Days to Comment on Performance Evaluations
To implement Section 853 of the National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2013 (Public Law 112-239) and Section 806 of the NDAA for FY 2012 (Public Law 112-81), both of which address contractor past performance evaluations, it is proposed to amend paragraphs (d) and (f) of FAR 42.1503, Procedures, to change the amount of time a contractor has to respond to an agency evaluation of the contractor’s performance from “a minimum of 30 days” to “14 calendar days from the date of notification of availability of the past performance evaluation...”
Section 806 mandated that the Department of Defense (DOD) amend the Defense FAR Supplement (DFARS) to implement this change, and Section 853 extended this mandate to all agencies.
Comments on this proposed rule must be submitted no later than October 7, 2013, identified as “FAR Case 2012-028,” by any of the following methods: (1) the Federal eRulemaking Portal: http://www.regulations.gov; (2) fax: 202-501-4067; or (3) mail: U.S. General Services Administration, Regulatory Secretariat Division (MVCB), ATTN: Hada Flowers, 1800 F Street NW, 2nd Floor, Washington, DC 20405.
DOD Proposes “Overarching Prescriptions” for Clauses with Alternatives
DOD is proposing to amend the DFARS to create “overarching prescriptions” for contract financing-related, quality assurance-related, and transportation-related clauses with one or more alternates. In addition, separate prescriptions for the basic clause and its alternate(s) would be added, and the text of the alternate would be included in the DFARS in full.
The “overarching prescriptions” would address the elements common to the basic clause and alternate. For example, DFARS 232.705-70, Clause for Limitation of Government’s Obligation, would read: “Use the basic or the alternate of the clause at 252.232-7007, Limitation of Government's Obligation, in solicitations and resultant incrementally funded fixed-price contracts.”
The specific prescriptions for the basic clause and alternate would address only the requirements for their use that enable the selection of the basic or the alternate. The revised prescription for DFARS 252.232-7007, Limitation of Government’s Obligation – Basic, would read: “Use the clause Limitation of Government's Obligation – Basic, if more than one line item will be incrementally funded”, and the prescription for its Alternate I would read: “Use the clause at 252.232-7007, Limitation of Government’s Obligation – Alternate I, if only one line item will be incrementally funded.” Separate prescriptions for the basic DFARS clauses and their alternates are intended to facilitate the use of automated contract writing systems.
The inclusion of the full text of each clause alternate is expected to make the terms of a clause alternate clearer to offerors and to DOD contracting officers (the current convention for alternates is to show only the paragraphs that differ from the basic clause). Inapplicable paragraphs from the basic version of the clause that are superseded by the alternate would not be included in the solicitation or contract to prevent confusion.
The following are the proposed clauses with alternate(s) that would have overarching prescriptions, specific prescriptions, and full text for alternate(s):
- Contract Financing-Related Clause: This proposed rule addresses the only clause in DFARS part 232, Contract Financing, that has an alternate: DFARS 252.232-7007.
- Quality Assurance-Related Clause: This proposed rule addresses the only clause in DFARS part 246, Quality Assurance, that has alternates: DFARS 252.246-7001, Warranty of Data. DFARS 246.710, Contract Clauses, would state: “(1) Use the clause at 252.246-7001, Warranty of Data – Basic, in solicitations and contracts that are not firm-fixed price or fixed-price incentive. (2) Use the clause at 252.246-7001, Warranty of Data – Alternate I, in fixed-price-incentive solicitations and contracts. (3) Use the clause at 252.246-7001, Warranty of Data – Alternate II, in firm-fixed-price solicitations and contracts.”
- Transportation-Related Clauses: This proposed rule addresses three clauses and their alternate(s): DFARS 252.247-7008, Evaluation of Bids, and its alternate; DFARS 252.247-7023, Transportation of Supplies by Sea, and its three alternates; and DFARS 252.247-7015, Requirements, which is an alternate to FAR 52.216-21, Requirements.
The proposed changes involving DFARS 252.247-7015 are more in the nature of a correction. Although DFARS 252.247-7015 is located with the other transportation clauses in DFARS 252.247, it is an alternate to be used with FAR 52.216-21 when “the contract is for the preparation of personal property for shipment or storage...”. Because DFARS 252.247-7015 more accurately applies to requirements contracts rather than transportation contracts, this proposed rule would create a stand-alone clause, DFARS 252.216-70XX, Requirements, and an alternate for use when the acquisition involves a partial small business set-aside.
Comments on these proposed rules must be submitted no later than October 7, 2013, by any of the following methods: (1) the Federal eRulemaking Portal: http://www.regulations.gov; (2) email: email@example.com; (3) fax: 571-372-6097; or (4) mail: Defense Acquisition Regulations System, OUSD(AT&L)DPAP/DARS, Room 3B855, 3060 Defense Pentagon, Washington, DC 20301-3060. Identify comments on the contract financing clause as “DFARS Case 2013-D014”; comments on the quality assurance clause as “DFARS Case 2013-D004”; and comments on the transportation clauses as “DFARS Case 2012-D057.”
In addition, DOD issued two final rules:
- Release of Fundamental Research Information: This final rule amends DFARS 252.204-7000, Disclosure of Information, to provide guidance relating to the release of fundamental research information.
DOD published a proposed rule to address requirements for safeguarding unclassified information which included changes to DFARS 252.204-7000 (see the July 2011 Federal Contracts Perspective article “DFARS Rules All Over the Place!”). However, this final rule separates DFARS 252.204-7000 from the rest of the proposed rule because the changes being made to DFARS 252.204-7000 deal with the release of information on fundamental research projects and not safeguarding information.
The following are the changes being made to DFARS 252.204-7000 by this final rule:
- Paragraph (a)(3) is added, and it includes the following as an exception to the contractor’s prohibition against disclosing information: “The information results from or arises during the performance of a project that has been scoped and negotiated by the contracting activity with the contractor and research performer and determined in writing by the contracting officer to be fundamental research in accordance with National Security Decision Directive 189, National Policy on the Transfer of Scientific, Technical and Engineering Information, in effect on the date of contract award and the USD (AT&L) memoranda on Fundamental Research, dated May 24, 2010, and on Contracted Fundamental Research, dated June 26, 2008, (available at DFARS PGI 204.4).”
- Paragraph (b) is revised to modify the time period that requests for information disclosure must be submitted to the contracting officer for approval from 45 days before the proposed date for release to 10 business days before the proposed date for release.
- Least Developed Countries That Are Designated Countries: This final rule revises the definitions of “designated country” in DFARS 252.225-7017, Photovoltaic Devices; DFARS 252.225-7021, Trade Agreements; and DFARS 252.225-7045, Balance of Payments Program – Construction Material Under Trade Agreements, as follows to reflect the United Nation (UN) General Assembly’s current list of least developed countries:
- Change the name of East Timor to Timor-Leste;
- Removed The Maldives because it is no longer a least developed country; and
- Add South Sudan, which seceded from Sudan to form an independent state on July 9, 2011, and was formally recognized as a least developed country by the UN in December 2012 (although the U.S. continues to impose sanctions against Sudan, South Sudan is not subject to sanctions).
GSA Launches Online IT Solutions Navigator
The General Services Administration (GSA) Office of Integrated Technology Services has launched a new e-tool designed to help federal, state and local governments get to the best-fit solution for their information technology (IT) and telecommunications needs. Called the “IT Solutions Navigator,” it is expected to help government agencies buy IT and telecommunications products and services by matching customer requirements to GSA’s best IT contract vehicles quickly and effectively.
The IT Solutions Navigator Tool is available at https://gsafas.secure.force.com/itsn. It provides a web-based portal that simplifies and expedites the acquisition of IT and telecommunications for GSA’s government agency customers. In three steps, the IT Solutions Navigator takes a customer’s requirements and provides that customer with the best-fit GSA contract vehicle solutions to fit their needs as well as an appropriate point-of-contact for more information:
- The customer selects whether it is a federal, tribal, state, or local government organization.
- The customer selects its IT and telecommunications needs (grouped in the following seven categories: cloud computing services; communications and network services; data center services; hardware products and services; professional services; security services; and software products and services).
- The customer selects its acquisition requirements (for example, place of performance; level of assistance; rent, lease, or purchase; equipment type; contract type; period of performance; socioeconomic objectives; and estimated dollar amount).
Based on the responses provided, the IT Solutions Navigator displays the most suitable contract vehicle(s) matching the customer’s criteria.
Video tutorials are available as is a live chat function so users can chat online directly to a customer service representative without having to call or e-mail.
VA Extends SDVOSB/VOSB Re-Verification to 2 Years
The Department of Veteran Affairs (VA) has decided to extend, from one year to two years, the period for service-disabled veteran-owned small businesses (SDVOSBs) and veteran-owned small businesses (VOSBs) to re-verify their eligiblility to participate in VA acquisitions set-aside for SDVOSB/VOSBs. VA has concluded that an annual examination is not necessary to adequately maintain the integrity of the verification program.
Verified SDVOSB/VOSBs are placed in the Vendor Information Page (VIP) database at http://www.vetbiz.gov.
The VA is required to set aside any open market procurement for SDVOSBs, and then VOSBs, if two or more such concerns are reasonably anticipated to submit offers at fair and reasonable pricing. To participate in these set-asides, VA must verify the individual owners’ service-disabled veteran status or veteran status. In addition, VA reviews an applicant’s financial statements; federal personal and business tax returns; personal history statements; articles of incorporation/organization; corporate by-laws or operating agreements; organizational, annual and board/member meeting records; stock ledgers and certificates; state-issued certificates of good standing; contract, lease and loan agreements; payroll records; bank account signature cards; and licenses. Firms found eligible by VA to participate in VA SDVOSB/VOSB set-asides are registered in the VIP database.
When this verification process was originally instituted (see the March 2010 Federal Contracts Perspective article “Veteran Business Status Verification Rule Finalized”), VA anticipated that annual examinations would be necessary to ensure the integrity of the verification program. However, given the depth of VA’s review, annual re-verification examinations have become an unnecessary administrative burden on both applicants/participants and VA. Therefore, VA has decided to amend the first sentence in paragraph (a) of Title 38 of the Code of Federal Regulations (CFR), Section 74.15, What length of time may a business participate in VetBiz VIP Verification?, by changing “1 year” to “2 years.” Now the first sentence reads: “A participant receives an eligibility term of 2 years from the date of CVE’s [Center for Veterans Enterprise’s] approval letter establishing verified status.”
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