rxEPA United States Environmental Protection Agency Administration And Resources Management (PM-211D) EPA/IMSD/91-001 January 1991 Selected Management Articles Contract Management PEOPLE ------- CONTRACT MANAGEMENT JANUARY 1991 Headquarters Library Information Management and Services Division U.S. Environmental Protection Agency Room 2904 PM-211A 401 M STREET, S.W. Washington, D.C. 20460 (202) 382-5922 ------- TABLE OF CONTENTS INTRODUCTION I Contracting as a Management Tool 1 II. Planning and Preparation 4 III. Effective Management & Monitoring of Contracts 10 IV. Environmental Contract Issues 12 V. Policy: Legislation & Regulation 15 VII. Selected Federal Documents on Contract Management 24 EPA Headquarters Library Management Collection List of Management Bibliographies 25 ------- CONTRACT MANAGEMENT BIBLIOGRAPHY INTRODUCTION The Contract Management Bibliography has been developed for EPA managers, and staff for use in understanding the many issues involved in Contract Management. These issues have become of critical importance as Federal, State and Local governments increasingly turn to the private sector for many of the services that public employees have traditionally performed. Governments, through their contracts with the private sector, can set criteria for many factors such as quality, flexibilty, and liability. Among the many issues of importance to both sides when contracting for provision of these services are: the objectives of the project, negotiation of a fair and equitable agreement, and an understanding of the performance measurements. The legislative and regulatory requirements affecting the formation and management of these contracts are also crucial. Each entry in this bibliographic report includes a summary of the citation with the source of the entry noted at the end. The bibliograpy is organized into the following sections: Contracting as a Management Tool; Planning and Preparation; Effective Management & Monitoring of Contracts; and Policy: Legislation & Regulation. The bibliography was compiled using ABI/INFORM and National Technical Information Service (NTIS) databases which are accessed through DIALOG. A special collection of materials on Contract Management is being developed in the EPA Headquarters Library. This collection will be available for use by EPA contract and project officers and other interested managers. The collection will include books and other publications on contract issues, including the effective management of contracts, legislation, regulation and policy. For copies of the articles listed in this bibliography or for information on the Contract Management collection, contact Sigrid N. Smith, Reference Librarian, EPA Headquarters Library, (202) 382-5922, or E-mail address Library.HQ/EPA3738. Other EPA Headquarters Library management bibliographies are listed at the end of this bibliography. ------- I.CONTRACTING AS A MANAGEMENT TOOL Evaluation of Factors That Influence Service Contract Quality Barnd, D. J. (Master's thesis) Naval Postgraduate School, Monterey, CA. (AD-AD220 128/3/XAB) Dec 89 69p Until recently quality improvement has been mainly applied to manufacturing. However, experience and the explosive growth of the services industry has shown that opportunities for simultaneous quality improvement must be undertaken. Today, both the Government and contractors are facing growing competitive and regulatory pressures to deliver higher quality services. In an attempt to comply with these pressures more emphasis has been placed on the inspection process and subsequently on the contract administration sections as they are tasked to develop and. apply efficient procedures for quality assurance. The research indicated that there are four factors that influence service quality. These factors are: the Quality of Assurance, the Contractor, the Statement of Work and the Performance Requirements Summary. The research concluded that the Government and contractors face the same challenges and must work together to develop a coherent policy on quality, grounded in a common language, common management principles, common standards and common goals. (NTIS) Award Fee Contracting as a J-Model Alternative to Revitalize Federal Program Management Hunt, Raymond G. Public Administration Review v45 n5 pp. 586-592 Sep/Oct 1985 To implement mixed-sector governmental projects effectively, they must often be conducted as joint undertakings by a government client and a private contractor. In practice, this requires provisions to facilitate active involvement of government managers in the operations of these programs. Award fee contracting is a joint government/contractor approach to encourage such participation. It constitutes an available J-model implementation methodology that is well-adapted to complex contractual relationships. Lessons are presented from recent US Department of Defense and other experience with this form of contracting. As long as the government's personnel are skilled and motivated to manage their programs, the award fee approach to contracting establishes an environment where it is possible for them to do it. It greatly enhances the power of government managers vis-a-vis contractor organizations, yet helps contractor organizations as well by encouraging positive, cooperative relationships. Moreover, it does this directly at operating levels that are vital to increased productivity. References.(ABI/INFORM) ------- A Decision Analysis Framework for a Contractor-Operated in-Plant Store Reid, Richard A.; Huth, Carl F.; Roybal, Dennis A. National Contract Mgmt Jrnl v!9 n2 pp. 37-47 Winter 1985 Government agencies are required to pursue private-sector provision of certain activities or operations when government provision would represent competition with private enterprise or when private contracting would lead to substantial cost reductions. A common means of contracting-out is through establishment of contractor- operated in-plant stores (IPS) for the supply of commonly used items in government agencies. A decision analysis framework is presented for assessing the potential effectiveness of IPS implementation. Initially, the commodity supply problem must be analyzed to determine if IPS implementation is feasible. If so, data must be collected to determine needed IPS characteristics, the commodities to be involved, and desired contractor attributes. Contractor proposals must then be invited and evaluated. After selection of the supplier, negotiation should lead to a mutually beneficial agreement. Finally, the IPS must be monitored for performance. Use of the proposed framework is illustrated via an IPS implementation at a government research and development facility. Tables. Diagrams. References. (ABI/INFORM) Government-Industry Contracting: What Should the Relationship Be? Stuart, Derald A. National Contract Mgmt Jrnl v!7 nl pp. 47-50 Summer 1983 The question of the proper relationship between government and industry in contracting for goods and services may be viewed from 5 different and often conflicting vantage points. These vantage points are those of: 1. the seller, 2. the buyer, 3. Congress, 4. the public, and 5. current and future users of the product. Furthermore, 4 different environments can be distinguished: 1. the classical free market, 2. the classical oligopoly, 3. the classical monopoly, and 4. the nonclassical market of pseudopartnerships with a single seller and single buyer. An analysis of these environments and vantage points demonstrates that a workable relationship, as experienced by the defense industry and the US Department of Defense, is one that is characterized by mutual trust, respect, and dependency. Without such a relationship between the government and industry, a project or program seems doomed to failure. (ABI/INFORM) Growing Opportunities in Public Service Contracting Mercer, James L. Harvard Business Review v61 n2 pp. 178,186,188 Mar/Apr 1983 Local governments all over the country are turning to the private sector for provision of many services that public employees ------- traditionally have performed. As costs rise and as tax and other revenues have difficulty keeping up, the private sector is likely to find many more opportunities to do work for local governments. Cost reduction is usually the reason for privatization, since firms can utilize economies of scale and other efficiencies of both capital and labor. Other criteria that local government units use for contracting out include considerations of quality, enabling legislation, control, in-house and external capability, flexibility, liability, union pressures, potential providers, community attitudes, personnel, and circumstantial factors. Factors to be considered by both parties are: 1. the negotiation of a fair and equitable agreement, 2. an understanding about performance measurement, 3. political perceptions by public officials, citizens, and community'leaders, and 4. objectives. A nonadversary partnership is of the essence if privatization is to work. Chart. (ABI/INFORM) Practices and Problems in the Management of Federal Research and Development Salasin, John ; Bregman, Howard Report No.MTR-7587 (PB81-233249) MITRE Corp., McLean, VA. METREK Div. Sponsor: National Inst. of Mental Health, Rockville, MD. Jun 77 75p This paper reports on the results of a survey conducted to provide an overview of federal research management. The survey was designed to provide input to a conference at which significant issues affecting the management of research might be further discussed. The survey contained questions addressing functions which are carried out in the management of research programs, techniques used in carrying out the functions, and problems encountered in managing the programs. While the major part of a manager's time and effort may be spent in fiscal and personnel administration, or in 'lobbying' for his/her program, the survey emphasized those management functions which relate to the substantive content of the research. Open ended questions were provided to give managers an opportunity to describe what they perceived as their greatest problems in managing research, and to describe their major achievements in improving management. (NTIS) Problems in the Management of Federal Contract Research Centers Waks, Norman Report No. MTP-119 (PB-197 109) Mitre Corp., Bedford, Mass. Sep 70 34p The paper is a response to a request from the Center for Strategic and International Studies of Georgetown University for a background paper on Federal Contract Research Centers. It attempts to list a ------- select number of the major management problems of FCRCs being borne by those institutional groups most.interested in FCRCs, and to show that these problems—indeed, the approach taken to most of the literature on the topic—has its origins, directly or indirectly, in the markedly different attitudes people have about FCRCs. (NTIS) II. PLANKING AMD PREPARATION Purchase of Service Contracting: Two Models Kettner, Peter M.; Martin, Lawrence L. Administration in Social Work v!4 nl pp. 15-30 1990 Purchase of service contracting (POSC) has been a major practice in human service delivery for more than a decade. In an attempt to develop a theoretical framework for thinking systematically about POSC, 2 alternative approaches are conceptualized the partnership model and the market model. The 2 models are conceptualized as pure types anchoring opposite ends of a continuum. A secondary data analysis of a national study of the POSC practices of the 50 state Social Services Block Grant agencies was conducted to test and validate the basic assumptions of the framework. The study data provide strong support for the existence of the partnership model and market model of POSC as an organizing theoretical framework. Of the 2 models, the partnership model is the more internally consistent. There is clearly an underlying pattern that unites the partnership model POSC decision factors and POSC administrative mechanisms. Charts. Tables. References. (ABI/INFORM) Decision analysis methods for selecting RFP (Request for Proposal) responses Hartley, D. S. ; Snyder, C. ; Boling, M. Report No.: K/DSRD-181 (DE90004003/XAB) Sponsor: Department of Energy, Washington, DC. Sep 89 13p Alternative methodologies are described for deciding the best response to a Request for Proposal (RFP) and the implications for each methodology are discussed. The differences in the resulting decisions that may occur under different decisionmaking methodologies emphasize the importance of choosing a method appropriate to the problem. For choosing a response to an RFP, a multiplicative combination that reflects the probability of success/failure may be important. 4 refs., 2 figs., 2 tabs. (NTIS) ------- Unbalanced Bidding in Government Contracts Bell, M. L. (Master's thesis) Air Force Inst. of Tech., Wright-Patterson AFB, OH. Report No. AFIT/CI/CIA-89-132 (AD-A217 379/7/XAB) 19 Feb 89 105p This chapter presents a general overview of unbalanced offers i the Government procurement process focusing on how they ar recognized and when they are unacceptable. In the course o procuring needed goods and services the Government agency wil solicit offers from interested contractors. The solicitation ma; be requesting offers to perform a single or multi-year supply service, or construction contract; a variable quantity service o: supply contract, an option contract, or a single or multi-itej supply contract. Regardless of the type of contract vehicle use< by the agency, the goal is the same: to make award to th< competitor whose offer is most advantageous to the Government. Contracts. (NTIS) Clearing Purchase Hurdles Surden, Esther Computerworld v22 n43 pp. 83,85 Oct 24, 1988 Federal data processing managers are faced with legislated justification procedures and procurement regulations mandating that extreme care be taken in any acquisition. Because procurements may take several years in areas where technology is advancing rapidly, computer systems and methods become obsolete almost as soon as they are installed. International Data Corp.'s Procurement Information Management Service's Eben Townes believes that one solution is better upfront planning to head off protests that cause delays. Lynn Furman of the Office of Personnel Management suggests developing contractual instruments that are flexible, have the potential for duration, and allow incorporation of options. Further, contracts could be made variable, so that quantities can be ordered as funding allows. The involvement of all interested parties, such as program planners and contracting officers, in an acquisition offers a better chance of minimizing delays. (ABI/INFORM) Investigation into the Effect of Contracting with Small Businesses on Procurement Workload (Final rept) Moshman Associates, Inc., Bethesda, MD. (PB89-152805/XAB) Sponsor: Small Business Administration, Washington, DC. Office of Advocacy. 4 Feb 88 73p The study investigated if contracting with small businesses increases the workload in procurement offices, as measured by the ------- ratio of contract actions to procurement personnel or by procurement salaries per action. (NTIS) An Ov«rvi«w of Small and Disadvantage Business Contracting Seidman, Paul J. National Contract Mgmt Jrnl v!9 nl pp. 5-19 Summer 1985 In order to realize the strategic benefits of small business participation in the defense industrial base,the declared policy of Congress,as stated in the Small Business Act, is to ''aid, counsel, assist, and protect...the interests of small business concerns.'' One advantage given to small businesses is the set- aside program, under which contracts are reserved exclusively for small businesses. There are 3 types of set-aside programs: 1. traditional, 2. small business purchase, and 3. small business innovation research. Section 8 (a) of the Small Business Act also gives special advantages to minority-owned small businesses. The benefits under 8(a) include the award of federal contracts on a sole-source basis, interest-free loans in the form of advance payments, and the gift of government funds. In order to be eligible,the firm must be a small business;it must be owned by economically and socially disadvantaged individuals,and it must have a reasonable prospect for success in the private sector.References. (ABI/INFORM) Prime Contractors Qualifying Additional sources, July 1985 (Report to the Congress) Office of Management and Budget, Washington, DC. Office of Federal Procurement Policy. (PB90-199217/XAB) 1 Jul 85 42p The report discusses the Office of Federal Procurement Policy's (OFPP's) views regarding the various methods that may be used to qualify competitive sources for subsystems, assemblies, and components of major systems, and the feasibility and desirability of acquiring prime contractors' qualification standards and processes as deliverable items under contracts. The consensus of views received and the data analyzed indicate that major systems are unique in terms of time, cost, technology, mission, and management requirements. The report outlines methods used to qualify competitive sources, i.e., vendor qualification and product qualification. The report offers specific guidelines for agencies and departments to follow in making decisions regarding qualification of sources and the acquisition of qualification processes from contractors. (NTIS) ------- National Security Management: - Performance Appraisals fo Contractors Anderson, John H., Jr.; Stapleton, Alan M. Bureaucrat vl3 n2 pp. 43-46 Summer 1984 The US Air Force has developed a performance appraisal process t assess the quality and quantity of services provided by Air Foro contractors. The Office of Personnel Management has developed , similar system to measure federal employees' performance. The Ai: Force's system was created in response to: 1. an increase ii contracting out, 2. a lack of power to directly supervisi contractor personnel, and 3. the lack of objective standards, whicl made it difficult to take action against contractors fo] unsatisfactory work. The 0PM set up its appraisal in response t< the Civil Service Reform Act of 1978. In both systems, objectivt performance standards are based on job analysis techniques. Th« Department of Defense has also developed generic standards for more than 50 functions in the department, and the OPM is researching generic standards for large occupational groups. Although bott systems can save money and increase productivity, both systems could be improved if the groups shared their experiences. References. (ABI/INFORM) Relaxing the Government's ''Firm Bid Rule11 When Bids Have Been Extended: A Recommendation Farber, Robert A. National Contract Mgmt Jrnl v!8 nl pp. 35-43 Summer 1984 Of the thousands of procurement actions accomplished by large purchase solicitation, most are processed within the original bid period. However, when the federal government does not do so, it places the bidders in a precarious position. In formal bid advertising, the bidder may modify his bid any time prior to the bid opening. However, once bid opening occurs, the bid is binding for the period specified in the bid and any agreed upon extension period. Most of the reported court decisions have involved withdrawal attempts during the original bid period or have made no attempt to distinguish the different considerations necessary in applying the rule where the bidder has attempted to withdraw during the period of extended acceptance. After considering the arguments for and against relaxing the firm bid rule, it is recommended that, when unforeseen delays require that bid extensions be obtained, the contracting officer should ask that the several lowest bidders extend their bids for some fixed period with the proviso that they be permitted to withdraw their bids prior to the award. Advantages would accrue to both the government and to the bidders. References. (ABI/INFORM) ------- The Government's Duty to Communicate An Expanding Obligation Gould, Alan; Leonard, Robin; Gore, Robert National Contract Mgmt Jrnl v!8 nl pp. 45-49 Summer 1984 Upon entering into a public contract, the government has a legal duty to disclose to a contractor information pertinent to performance of the contract. The government has a duty to disclose any superior knowledge in its possession and has a duty to communicate the fullest and most accurate information possible about the contract requirements. The courts have not always been clear about the relationship between the doctrine of superior knowledge and the duty to communicate. Until recently, the courts have limited the government's duty to the disclosure of factual material. However, in the Automated Services Inc. (ASI) opinion, the General Services Administration Board of Contract Appeals held that the government breached its implied duty to communicate when it failed to disclose the full scope of its views concerning the contractor's ability to fulfill the contract, thus expanding the obligation to nonfactual information as well. Chart. References. (ABI/INFORM) Financial Management and Data Processing Considerations for Fixed Price Contracts/Subcontracts with Progress Payments Curry, William S. National Contract Mgmt Jrnl v!6 nl pp. 59-66 Summer 1982 Contract administration of fixed price contracts or subcontracts with provisions for progress payments requires the forecasting of cash payments. A simulation of the contract is one method of calculating this data. The simulation will include such data as: 1. actual cost incurrence, 2. progress payments, 3. deliveries, 4. partial payments, and 5. liquidation of progress payments. This simulation data will also aid record keeping for these contracts. The contract administrator for a contract with progress payments has full responsibility for approving payments, insuring that progress payments will be fully liquidated during the life of the contract, disapproving progress payments exceeding the maximum allowable level, and tracking cost incurrence versus contractual milestones. Further, the administrator may invoke suspension of payments and other alternatives if the supplier's performance is unsatisfactory. The formats and directions to the recommended simulation are offered as aids to administrators. Figures. Appendices. (ABI/INFORM) 8 ------- A Guide for Applying the Concepts of Life Cycle costing t< Procurements by state and Local Governments Logistics Management Inst., Washington, D.C. Report No. NBS-GCR-ETIP-76-17 (PB-254 233/0) 1976 209p The guide has been developed to assist the public purchasing community to more fully understand, and use the elements of lif€ cycle costing in the procurement process. The guide contains chapters on concept and theory of LCC, use of LCC in equipment purchases, use of warrantees in LCC structuring LCC procurements and selected case studies plus appropriate contract clauses in equipment procurement. The guide has application at the Federal, State and local levels of procurement activity and for industrial purchasing agents as well. The guide was developed as part of the Experimental Technology Incentives Program's research in the use of procurement policies in .providing incentives to innovation and technological change. (NTIS) An Evaluation of Contractor Projected and Actual Costs Kwiatkowski, K. A. ; Buffalano, C. Report No. NASA-TN-D-7644; D-7644 (N74-27453/1) National Aeronautics and Space Administration. Goddard Space Flight Center, Greenbelt, Md. Jun 74 16p GSFC contractors with cost-plus contracts provide cost estimates for each of the next four quarters on a quarterly basis. Actual expenditures over a two-year period were compared to the estimates, and the data were sorted in different ways to answer several questions and give quantification to observations, such as how much does the accuracy of estimates degrade as they are made further into the future. Are estimates made for small dollar amounts more accurate than for large dollar estimates? Other government agencies and private companies with cost-plus contracts may be interested in this analysis as potential methods of contract management for their organizations. It provides them with the different methods one organization is beginning to use to control costs. (NTIS) ------- III.EFFECTIVE MANAGEMENT & MONITORING OF CONTRACTS Electronic Data Interchange in Procurement (Final rept) Drake, D. J. ; Ciucci, J. A. ; Milbrandt, B. Logistics Management Inst., Bethesda, MD. Report No. LMI-PL904RI (AD221 112/6/XAB) Apr 90 88p Evaluates the issues associated with implementation of electronic data interchange (EDI) to Government procurement. Provides detailed analysis of the advantages of EDI and how it can be applied to primarily small purchases under Federal Acquisition Regulation (FAR) Part 13. Provides a sample trading partner agreement and recommends changes to the FAR to recognize EDI in Government procurement. This report also discusses such issues as electronic signatures, electronic records, paperless contracting, legal sufficiency, small business opportunities, security of competition- sensitive information, and implementation. (NTIS) Guide to Special Considerations in Government Research and Development Contracting Rodriguez-Morales, 0. V. (Master's thesis) Air Force Inst. of Tech., Wright-Patterson AFB, OH. School of Systems and Logistics. Report No. AFIT/GCM/LSP/89S-9 (AD-A216 345/9/XAB) Sep 89 109p This thesis researched applicable literature on special characteristics related to Government R&D contracting. Emphasis was placed on small dollar government R&D procurement. A comprehensive literature review, together with informal interviews with contracting personnel from RADC Griffiss AFB NY were used to develop this study. The special characteristics include R&D definitions, different stages in R&D, R&D's interaction with the economy, technical considerations in R&D, R&D contract types, competition and R&D, roles of critical officers in R&D contracting, and some performance problems encountered in R&D. The research for this study showed that R&D is a fundamental component of this nation's technological leadership. Better training is required for personnel involved in R&D procurement. Contracting Officers, Program Managers, and Contract Administrators are part of a very important team which is in charge of supervising the efficiency and effectiveness of government R&D procurement. Most of the performance problems encountered in government R&D procurement can and should be resolved for its success. This study will become part of NCMA's Body of Knowledge library. It condenses the special considerations in government R&D contracting in a manner that is easily accessible to interested readers with some experience in government contracting. (NTIS) 10 ------- issues in the Development of Monitoring Systems for Purchase of Service Contracting Kettner, Peter M.; Martin, Lawrence L. Administration in Social Work v9 n3 pp. 69-82 Fall 1985 Because of declining resources and increasing emphasis on service efficiency and effectiveness, monitoring programs for purchase of service contract (POSC) should be an area of serious concern to human service administrators. POSC monitoring is the periodic review and documentation of the contractor's progress in fulfilling the terms of the contract, the identification of areas in which corrective action is required, and follow-up to make certain that corrective action is successfully taken. There are 4 primary purposes of POSC monitoring: 1. assuring accountability, 2. assuring compliance with the terms and conditions of the contract, 3. identifying problem areas, and 4. providing decision makers with information for future planning. Among the features that a well- designed monitoring system should include are a clear statement of philosophy, concise, focused monitoring reports, and timely reviews of contractor reports and claims. References. (ABI/INFORM) Analyzing Performance of Small Projects Using URS and PMAS. Information Pamphlet Department of Energy, Washington, DC. Office of Project and Facilities Management. Report No. DOE/MA-0184 (DE85011964/XAB) Mar 85 64p This pamphlet addresses some basic tools used in the analysis of small project performance, the Uniform Reporting System (URS) and the Performance Measurement Analysis System (PMAS) . The flexibility inherent in the URS allows DOE project managers the latitude to negotiate with contractors several key elements in contract performance measurement. Through reviews of management systems documentation, analysis of reports, orientation briefings, and site visits, the project team can obtain a good understanding of how the contractor plans and controls work. This knowledge assists them in performing data analysis by understanding how the data is put together. The key performance measurement data, which are taken or calculated from the cost and schedule report, quantifies the overall effect of the small problems that the project manager frequently deals with. As important as daily contact with project progress is in management of smaller projects, it is equally important to be aware of overall progress and the general trend. The PMAS easily permits management to periodically focus on contract performance trends and forecast contract cost at completion by using simple graphic displays and supporting reports. (NTIS) 11 ------- Managing a Solution to the Procurement Fraud Problem Kenney, Robert J., Jr. National Contract Mgmt Jrnl vis n2 pp. 19-27 Fall 1984 Fraud and abuse in the federal procurement process is not so much a legal problem as a management problem. Thus, contractors can institute management practices to help ensure compliance with procurement law and standards. Such procedures must be based on a clear understanding of how the company works. A successful compliance program will have the unambiguous commitment of top management and will be implemented through existing management channels. The core of the program will be a set of straightforward rules cast in a ' 'DO1 ' and ''DO NOT11 format. The compliance program must be reinforced with information systems that make compliance feasible. The information system must be backed by an effective system for monitoring compliance and reporting noncompliance. While some questions of equity might be raised, management will generally do well to impose a policy of the strictest discipline in regard to procurement compliance. (ABI/INFORM) IV. ENVIRONMENTAL CONTRACT ISSUES Environmental Liability: "Uncertain Times11 for Government Contractors Lee, Robert T. National Contract Mgmt Jrnl v23 n2 pp. 45-53 1990 Whether they are involved with the government as operators of government-owned, contractor-operated facilities or in production contracts carried out at their contractor-owned, contractor- operated facilities, contractors must be aware of contract law associated with environmental requirements, civil litigation, and criminal law. A major area of environmental compliance that affects government contractors has been liabilities associated with the federal Superfund law. This law has resulted in government contractor liabilities for cleanups related to the disposal of hazardous wastes thought to have been disposed. The government contractor is most likely concerned with environmental compliance requirements in the contract itself and the extent to which the government contractor may allocate to the government costs associated with environmental compliance, fines, and penalties. A government contractor involved as a defendant in environmental litigation must try to involve the federal government itself as a defendant or codefendant. References. (ABI/INFORM) 12 ------- Cleanup Contracts Can Contain Hidden Risk; Contractors Told to Check Many Variables Harty, Sara J. Business Insurance v24 n48B pp. 22-23 Nov 26, 1990 Contractors cleaning up hazardous waste sites must make sure they cannot be held liable for pollution at the site they are attempting to clean up, said James E. Freeman of Kellogg Corp. Speaking at the loth annual Construction Insurance Conference, Freeman warned that cleanup contractors must be certain that their contracts are properly worded to avoid hidden liabilities. The cleanup contractor can become a potentially responsible party if it can be demonstrated that, because of the contractor's operations at that site, there was an actual or a threatened release of hazardous substances to the environment. Once contractors become involved in cleanup operations, they can be linked to the site and its pollution liabilities forever. Pollution cleanup contractors attempting to gauge whether there are any hidden liabilities at a hazardous waste site can use a series of checklists to assess risks before signing a contract. A group of contractors developed the checklists as a result of discussions at the 5th annual meeting of the Hazardous Waste Action Coalition. (ABI/INFORM) Environmental Services Sternberg, Ken Chemical Week v!46 n!7 pp. 20-23 May 2, 1990 Environmental Protection Agency (EPA) chief William K. Reilly's mandate to make polluters pay for cleanups is restructuring the environmental services industry. Companies that in the past profited on government cleanup contracts now struggle with flat or declining margins. Others that developed their own niches enjoy earnings growth of up to 30% a year. Escalating liabilities and costs for environmental cleanups have made specialty consulting and hazardous waste remediation lucrative. The need for these services is just as strong in Europe. US-based environmental service companies are interested in these opportunities; many have operated in Europe for several years, and others are ready to enter. The advantage in the US is the large market opportunity driven by tighter federal regulations. European regulations will tighten also, as rising popular demand there to fix long-standing environmental problems creates a large pool of need for technical expertise. Market opportunities in Western Europe vary from one country to another. The best chance for US companies is to form partnerships with existing companies and complement gaps in their services. (ABI/INFORM) 13 ------- Superfund Dialogue Needed Mclntyre, Kathryn J. Business Insurance v24 n3 pp. 3,30 Jan 15, 1990 Several Superfund experts agree that the property-casualty insurance industry must negotiate with environmental groups before proposing changes in the liability and cleanup funding provisions of the Superfund law. E. Donald Elliott, assistant administrator and general counsel of the Environmental Protection Agency (EPA), advised insurance company executives to try to develop a dialogue with the environmental community. The property-casualty insurance industry, which is being sued by its policyholders to cover Superfund cleanup costs, has advocated amending a 1980 law that holds parties jointly and severally liable for government-mandated cleanups of pollution caused decades ago. Insurers contend that their contracts never were intended to cover such liabilities and have advocated a no-fault funding system for cleaning up pollution at Superfund sites that took place before the Superfund law was passed. William H. Bolinder of Zurich Insurance Co. suggested that money could be raised by imposing a new tax on toxic materials and products that contain toxic materials. (ABI/INFORM) A Practical Guide to Environmental Indemnification Agreements Dore, Michael Defense Counsel Jrnl v55 n3 pp. 297-300 Jul 1988 The demand for and the negotiation of environmental indemnification agreements have grown dramatically. Environmental indemnification agreements are used in a wide variety of situations, such as: 1. when real property or industrial establishments are sold or transferred, or 2. when environmental investigations or cleanups are performed. State law determines the enforceability of environmental indemnification agreements. States generally have found that parties may be indemnified with respect to the imposition of strict liability. The federal Superfund statute provides that, while indemnification agreements do not protect the contracting parties from liability to the government or injured third parties, they are enforceable as between the contracting parties. Some of the key issues to consider when evaluating an environmental indemnification agreement are: 1. the identity of the party giving the indemnity, 2. the treatment of the officers and directors of the indemnitees, 3. the standard of liability that is protected against, and 4. the relationship between the indemnification obligation and the indemnitee's insurance protection. References. (ABI/INFORM) 14 ------- V. POLICY; LEGISLATION & REGULATION What Is C/SCSC? In English, Please! Grskovich, Donald L. National Contract Mgmt Jrnl v23 n2 pp. 25-32 1990 Cost schedule control systems criteria (C/SCSC) were developed because the US government needed a way to reliably quantify the costs of planned procurements before they were begun. The main objectives of C/SCSC are to require contractors to employ management control systems for cost-schedule planning and tracking and to provide timely and auditable data for use by the contractor and custom project-contract management. A 1967 Department of Defense (DOD) document defined 35 criteria that the DOD would impose on management control systems of contractors with which it did business. These criteria involve: 1. organization, 2. planning and budgeting, 3. accounting, 4. analysis, and 5. revisions and access to data. The 4 steps in C/SCSC are: 1. establishment of a base line, 2. management of the base line, 3. measurement of performance as the work is done, and 4. assessment of what is left to be accomplished and projection of the estimate to complete. Tables. (ABI/INFORM) Federal Ethics Reforms Pose New Dilemmas for Contractors Kidd, Yvonne Inform v4 n4 pp. 74,76 Apr 1990 Over the past year, a series of laws has been enacted by Congress that are intended to stem greed and corruption in the federal procurement system. To put the laws into practice, the government must assure that public contracts are awarded fairly and not based on considerations or personal gain. At the same time, it must not so criminalize and burden the system that companies no longer want to do business with the government. One of these laws is the Procurement Integrity Act. It was suspended as part of the Ethics Reform Act of 1989 because it confused agencies and vendors as to what kinds of conduct and interactions were prohibited. In an attempt to weed out unfair competitive advantages in the procurement process, the consultant conflict of interest law and implementing guidance issued by the Office of Management and Budget impose substantial reporting requirements on contractors. (ABI/INFORM) Regulatory Relief: Simplifying and Eliminating Contract Clauses. Volume 1 Logistics Management Inst., Bethesda, MD. Report NO.LMI-PL903RI-VOL-1 (AD-224 768/2/XAB) Nov 89 152p This report sets forth our analysis of the 1,090 solicitation 15 ------- provisions, contract clauses, and alternates in the Federal Acquisition Regulation (FAR) and the DoD FAR Supplement (DFARS). Contract clauses and solicitation provisions - hereafter simply called 'clauses' are a principal means of implementing the policies contained in the acquisition regulations. The report presents such information about the clauses as whether their origin is statutory or nonstatutory. 'Statutory1 is used here to embrace clauses based on law, Executive order, Office of Management and Budget (OMB) circular, Office of Federal Procurement Policy (OFPP) policy letter, other executive branch directive, or nonprocurement regulation published in the Code of Federal Regulations. The report also indicates whether the clause flows down to subcontractors and the tier to which flowdown occurs. In the rest of this report, we first describe (Chapter 2) the coding conventions used to present our review and analysis of the clauses. This description is followed in Chapter 3 by the detailed report on the 451 clauses (including alternates) from the DFARS, presented in numerical order by DFARS part. (NTIS) Regulatory R«li«f: Simplifying and Eliminating Contract Clauses. Volume 2 Logistics Management Inst., Bethesda, MD. Report No. LMI-PL903RI-VOL-2 (AD-A224 767/4/XAB) NOV 89 17lp This report sets forth our analysis of the 1,090 solicitation provisions, contract clauses, and alternates in the Federal Acquisition Regulation (FAR) and the DoD FAR Supplement (DFARS). Contract clauses and solicitation provisions - hereafter simply called 'clauses' are a principal means of implementing the policies contained in the acquisition regulations. The report presents such information about the clauses as whether their origin is statutory or nonstatutory. 'Statutory' is used here to embrace clauses based on law, Executive order, Office of Management and Budget (OEM) circular, Office of Federal Procurement Policy (OFPP) policy letter, other executive branch directive, or nonprocurement regulation published in the Code of Federal Regulations. The report also indicates whether the clause flows down to subcontractors and the tier to which flowdown occurs. Finally, Chapter 4 arrays the 639 clauses (including alternates) from the FAR, also in numerical order by part. (NTIS) Regulation of Federal Contractors' Employment Patterns Meyers, Edward M. Public Administration Review v49 nl pp. 52-60 Jan/Feb 1989 Social regulation focuses principally on matters of health, safety, environmental protection, and social practices. It is generally implemented through single-headed line agencies that are under presidential authority within the executive branch. The rise in 16 ------- social regulation in the 1960s and 1970s led to a reexamination in the 1980s by corporations, the general public, and elected leaders of the desirability of such controls. It was within this context that a sharp deemphasis was placed on the regulatory actions of the Department of Labor's Office of Federal Contract Compliance Programs (OFCCP). The OFCCP is responsible for ensuring nondiscrimination in the workforce of federal contractors. There are 3 major causes of the OFCCP deemphasis of affirmative action enforcement: 1. lack of executive branch leadership, 2. inadequate congressional oversight, and 3. the difficulty of achieving social regulation of minority interests. Several options are available to policymakers considering a renewed emphasis on affirmative action among federal contractors. References. (ABI/INFORM) The OFCCP in 1989: Where It's At and Where It's Going McCulloch, Kenneth J. Employment Relations Today v!5 n4 pp. 305-311 Winter 1988/1989 The US Department of Labor's Office of Federal Contract Compliance Programs (OFCCP) is charged with enforcing a series of Executive Orders directed toward employers that are federal government contractors or subcontractors. The OFCCP is the only federal agency with the authority to request or require employers to take prospective affirmative action in the workplace. Recent judicial, legislative, and organizational developments and demographic changes have confirmed the government's commitment to affirmative action and solidified the OFCCP's position. For example, in California Federal Savings and Loan Association versus Guerra, the Supreme Court upheld the validity of a California statute granting special pregnancy leave rights. Personnel changes that have affected the OFCCP have also been significant, as has a policy change aimed at opening the top level of corporate jobs to women and minorities. As the agency most attuned to affirmative action and changing demographics, the OFCCP may be in the best position to deal with the aging workforce. Tables. Graphs. (ABI/INFORM) The Truth in Negotiations Act: A Primer Feldman, Steven W. National Contract Mgmt Jrnl v21 n2 pp. 67-81 Winter 1988 The purpose of the Truth in Negotiations Act is to ensure that the government obtains fair and reasonable prices on certain contracts by requiring contractors and subcontractors to disclose all known facts at the time of negotiations that could have a material impact. The Federal Acquisition Regulation (FAR) implements the Act in executive contracting agencies and elaborates on it in several important respects. FAR sets forth the basic rules for disclosure, and it recognizes 3 mandatory exemptions to the submission requirements,including prices:1.based on adequate competition, 17 ------- 2. based on catalog or market prices, and 3. set by law or regulation. FAR also sets forth a standard certificate of current cost or pricing data, which should be used verbatim to ensure a legally correct certificate.If, afteraward, the government learns that the contractor submitted defective data,the government is allowed a price adjustment. References. (ABI/INFORM) Understanding the submission Requirement for Cost or Pricing Data Lovitky, Jeffrey A. National Contract Mgmt Jrnl v21 nl pp. 57-65 Summer 1987 The Truth in Negotiations Act mandates the submission of cost and pricing data in all contract negotiations exceeding $100,000 and applies to both civilian and military agency procurements. However, government regulations provide little guidance on how cost and pricing data should be furnished. Guidance contained in the Armed Services Pricing Manual (ASPM) requires that each major category of cost be broken down into its constituent elements. The ASPM provides little guidance, however, on the submission of data applicable to indirect costs. In view of the manual's omissions, some major systems contractors attach the commonly used Standard Form 1411 to information relating to the Defense Contract Audit Agency's audit of the contractors' indirect costs, an unsatisfactory practice. More effective guidance is needed in evaluating the adequacy of data submissions. Tables. References. (ABI/INFORM) An Evaluation of Federal Contract Set-Aside Goals in Reducing Socioeconomic Discrimination Black, Dennis E. National Contract Mgmt Jrnl v20 n2 pp. 87-104 Winter 1987 In October 1978, Congress created a new contract goal-setting procedure with the aim of more effectively implementing federal contract set-aside programs targeted to socioeconomically disadvantaged groups. A systematic analysis of the effectiveness of federal contract goal setting in reducing socioeconomic discrimination was conducted. It was found that most agencies took a conservative approach by proposing annual goals they were certain could be met. It also was found that the goal-setting procedure did not significantly increase federal contract dollars to socioeconomically disadvantaged groups. Federal agencies consistently met or exceeded their goals, but there has been no increase in the annual share of federal contract dollars going to 4 targeted groups which were examined. It is concluded that the federal contracting process does not appear to be effective. Tables. Graphs. References. (ABI/INFORM) 18 ------- Cost and Pricing Data Defined: .An Analysis of the Scope of Contractor Disclosure Requirements Pursuant to the Truth in Negotiations Act Lovitky, Jeffrey A. National Contract Mgmt Jrnl v20 n2 pp. 79-85 Winter 1987 The Truth in Negotiations Act of 1962 requires the submission of complete, current, and accurate cost and pricing data prior to the awarding of any negotiated contract over $100,000. It is argued that any workable definition of cost and pricing data must be equally applicable to 3 cost elements: 1. direct labor, 2. material, and 3. indirect costs. It is concluded that the requirement for submission of cost and pricing data is an intrusive tool the government may use to obtain a broad spectrum of information concerning a contractor's business activities. In addition, unless pressed for specific categories of information, contractors are unlikely to disclose all that is required by the statute. Recent legislative enactments, however, indicate, that Congress is serious about Truth in Negotiations. Therefore, contractors should be careful to submit the appropriate data. References. (ABI/INFORM) Ethics in Government Contracting: Putting Your House in Order Mur, Raphael National Contract Mgmt Jrnl v20 n2 pp. 15-50 Winter 1987 The original purpose of the "Grumman Code of Business Conduct" was solely to protect shareholders' interests. The current version, approved in October 1986,. evolved in response to changing external conditions, that is, increased enforcement and increased penalties in the antitrust area and enforcement followed by legislation in the foreign corrupt practices area. The Department of Defense inspector general (IG) reissued a former document that is now referred to as the "Red Book." An analysis of the development of the Grumman Code addresses: 1. labor mischarging, 2. cost and pricing data, 3. product substitution, 4. independent research and development and bid and proposals, 5. business meals, 6. retired personnel, 7. classified documents, and 8. audit reports. A compliance program should include such key elements as an examination of relevant government statistics, regulations, and policies, a selfexamination in critical areas, and a continuing education program. Diagrams. Appendix. (ABI/INFORM) The "New Morality" Environment in Government Contracts Dees, C. Stanley National Contract Mgmt Jrnl v20 n2 pp. 1-14 Winter 1987 There is a new focus on procurement fraud, waste, and abuse that has resulted in legislation and an increased volume of criminal investigations and prosecutions. The Department of Defense 19 ------- inspector general points to 8 specific areas in which fraud is suspected: 1. obtaining government contracts, 2. defective pricing, 3. collusive bidding and price fixing, 4. cost mischarging, 5. product substitution, 6. progress payment fraud, 7. fast pay fraud, and 8. bribery, gratuities, and conflicts of interest. This increased interest in procurement fraud ultimately will result in a weakened national security. Although defense contract fraud is a serious problem, it is not as prevalent as many believe. Neither an increase in government regulation nor the repeated use of criminal sanctions will make the defense acquisition system more effective. Individual contractors must devise and maintain a system of self-governance. (ABI/INFORM) The Service Contract Act: Navigating the Labyrinth Kennedy, Robert A. Compensation & Benefits Review v!8 n4 pp. 21-27 Jul/Aug 1986 Administering the Service Contract Act (SCA) is a challenge. The purpose of the SCA is to protect service workers from the effects of the government's procurement policy, which awards service contracts to the lowest bidder. Any employer that contracts to do work for the federal government must conform to the intent and letter of the law and will be penalized severely for any violations. Compliance with the SCA begins with the contractor's compensation manager gathering data minimum rates paid, maximum rates paid, and average rates on every nonexempt occupation. The Employment Standards Administration issues over 80,000 wage determinations a year. Because no 2 administrative contracting officers administer the requirements of the law in the same way, the compensation manager should walk each participant through every phase of the conformance procedure. The SCA costs the government an average of about $1 billion annually in inflated service procurement costs. Modifications restricting the act's application could produce significant savings for taxpayers. (ABI/INFORM) Implementation Guide. Cost and Schedule control systems Criteria for contract Performance Measurement Department of Energy, Washington, DC. Office of Project and Facilities Management. Report No.DOE/MA-0203 (DE6006166/XAB) Jan 86 98p This document provides guidance for implementation of DOE Order 2250.IB, Cost and Schedule Control Systems Criteria (CSCSC) for Contract Performance Measurement. Its use assists DOE and contractor representatives in fulfilling their responsibilities for meeting CSCSC requirements. The CSCSC are designed to avoid the necessity for imposition of specific management control systems on contractors. Implementation of the CSCSC consistent with this guidance and compliance with the contractual requirements for work 20 ------- definition, cost and schedule control, and performance reporting provide DOE assurance that a contractor's cost and schedule progress is sufficiently visible to provide a reliable basis for timely and meaningful management decisions. (NTIS) Breakout The Mystery Unveiled Young, Donald P. National Contract Mgmt Jrnl v!9 nl pp. 33-40 Summer 1985 In 1984, Congress enacted legislation relating to the Breakout Procurement Center Representative program. This program gives procuring agencies effective new tools that will dramatically alter federal procurement. For many years, small businesses have proved to be responsible and cost-effective contractors to the federal government and crucial to a broad defense industrial base. The importance of breakout became apparent when ''horror stories'' of exorbitant prices being paid for commercially available items appeared in 1981. Statutory provisions now require written justification for prequalification, specificity of what must be done to qualify, an estimate of what it will cost, prompt opportunity to qualify, unbiased evaluation and testing, and a debriefing as to the reasons for failure on the part of either a firm or product to qualify. The solution to procurement of the best state-of-the-art defense equipment at a reasonable price is in hard work, education, and cooperation. (ABI/INFORM) The New Bid Protest Remedies Created by the Competition in Contracting Act of 1984 Coburn, George M. National Contract Mgmt Jrnl v!9 nl pp. 47-60 Summer 1985 Congress enacted the General Accounting Office (GAO) procurement protest system as part of the Competition in Contracting Act of 1984 (CICA) to ensure competition and equitable relief for those wrongfully excluded from competing. Congress also amended the Brooks Act, creating an alternative protest remedy for automatic data processing equipment and services procurements in the General Services Board of Contract Appeals (GSBCA). A summary is presented of the differences between the 2 protest remedies, the principal one being that the GSBCA provides the opportunity for a trial-type proceeding while the GAO generally resolves opposing arguments by the administrative record. Also discussed are the various constitutional issues raised by the Reagan Administration's refusal to comply with the stay of contract award and contract performance provisions and the award of costs provisions of the CICA. For these refusals, Congress may cite the offending officials for contempt or bring impeachment proceedings. References. (ABI/INFORM) 21 ------- Small Business and the Government contract: will Your Trade Secrets Stay secret? Guimera, Irene M. National Contract Mgmt Jrnl v!9 nl pp. 41-45 Summer 1985 A review is given of government contracting with respect to trade secrets. Trade secrets are not registered with any governmental body, and their treatment is regulated by a changing, uncertain body of case law that varies from state to state. In government contract requests for proposals, it is the offerer's duty to designate in the proposal any confidential and proprietary material. The general policy is that information developed at private expense, and which has not been released to the public or to others without limitations on further use or disclosure, will be obtained with limited rights. In order to oppose disclosure of information under the Freedom of Information Act, the best practice is to work closely and cooperatively with the government agency. Advance consideration given to the issue of relinquishment of trade secrets will result in greater protection for the private firm. References. (ABI/INFORM) The Small Business Sector: Defining and Reaffirming the Federal Role Mitchell, Parren J. National Contract Mgmt Jrnl v!9 nl pp. 1-4 Summer 1985 For the small business sector of the US economy, the enactment of the Small Business and Federal Procurement Competition Enhancement Act of 1984 is a milestone for potential new expansion and profitability. Before passage of the act, from fiscal year 1981 to fiscal year 1982, the small business share of Department of Defense contracts had decreased from 20.4% to 19.7%. Small businesses lead the way in innovation, applied research, and invention, thus potential barriers to small business should be lifted. The critical issue in the small business community is not tax reform, but fairness. Some reforms suggested in House of Representatives Bill 2496 include: 1. allowing taxpayers to defer capital gains taxes if the proceeds are reinvested in a qualified small business, and 2. allowing taxpayers an immediate deduction for such an investment. The federal role in relation to the small business sector must be reaffirmed in stronger terms. (ABI/INFORM) An Economic Evaluation of the Service Contract Act Goldfarb, Robert s.; Heywood, John S. Industrial & Labor Relations Review v36 nl pp. 56-72 Oct 1982 The Service Contract Act of 1965 (SCA) is one of the laws requiring that ''prevailing wages'1 be paid by employers with federal contracts. Eight possible rationales for the SCA were identified and evaluated: 1. prevention of average-wage busting, monopsony, 22 ------- and similar wage practices, 2. 'prevention of individual-wage busting, 3. encouragement of collective bargaining, 4. the model- employer rationale, which contends that the government should support private employers who pay attractive wages, 5. protection of government workers, 6. encouragement of the geographic balance of contracts, 7. reduction of labor importation, and 8. the quality of service rationale. A formula was developed to determine the costs of extending SCA to research and development (R&D) contracts. The formula revealed an overall simple average increase of 4.55% which combined with wage-bill estimates, shows the wage cost of extending SCA to R&D and related contracts in fiscal 1979 would have ranged from $75.5 million to $150.6 million. Cost estimates would be modified if SCA administrators centered on different rationales in making their calculations. Table. References. (ABI/INFORM) 23 ------- CDERAL DOCUMENTS ON CONTRACT MANAGEMENT The following titles were produced by Federal agencies and are located in the Headquarters Library as noted by the call numbers given below. Selected sections of the Federal Aquisitions Regulations (FAR) are also available. The Library staff will assist patrons in obtaining other sections. Civil Servants and Contract Employees: Who Should Do What For the Federal Government. General Accounting Office, 1981 HD3858.U53 Contracts Management Manual. Environmental Protection Agency, 1985 (with updates) EPAX 8911-0040/1900 Contracts Status of EPA's Contract Management Improvement Program. General Accounting Office, 1987 HD3616.U46B83 Environmental Protection Agency Acquisitions Regulations (EPAAR) Environmental Protection Agency, 1986 EPAX 8911-0040/1901 Federal Acquisitions Regulations (FAR) Department of Defense; General Services Administration, 1983 Federal Information Resources Management Regulation (FIRMR) General Services Adminstration, Office of Information Resources Management, 1984 JK1673.F42 1984 Project Officer's Handbook Environmental Protection Agency, 1984 EPAX 8902-0009 Use of Contractor Services. Environmental Protection Agency, 1985 (with updates) EPAX 8911-0040 1900.1 24 ------- EPA HEADQUARTERS LIBRARY MANAGEMENT COLLECTION List of Management Bibliographies 1 . MANAGING A DIVERSE WORK FORCE by Anne Twitchell, September 1990 EPA/IMSD-90-011 2 . PROJECT MANAGEMENT by Anne Twitchell, June 1990 EPA/IMSD-90-007 3 . STRATEGIC PLANNING by Anne Twitchell, March 1990 EPA/IMSD-90-005 4 . TOTAL QUALITY MANAGEMENT by Anne Twitchell, December 1989 EPA/IMSD-89-009 5 . LEADERSHIP: QUALITY MANAGEMENT FOR THE FUTURE by Anne Twitchell, September 1989 EPA/IMSD-89-005 6 . COMMUNICATION SKILLS FOR EFFECTIVE MANAGEMENT by Anne Twitchell, June 1989 EPA/IMSD-89-003 7 . EFFECTIVE PERFORMANCE APPRAISALS by Anne Twitchell, March 1989 EPA/IMSD-89-002 8. OFFICE OF THE FUTURE: THE MANAGER'S ROLE by Anne Twitchell, December 1988 EPA/IMSD-88-013 9. OFFICE OF THE FUTURE: THE CHANGING ROLE OF SECRETARIES by Mary Hoffman and Anne Twitchell, revised May 1989 10. MANAGEMENT TRANSITION by Mary Hoffman and Anne Twitchell, September 1988 EPA/IMSD-88-007 11. MANAGING IN THE PUBLIC SECTOR by Mary Hoffman, March 1988 EPA/IMSD-88-003 25 ------- 12- RESISTANCE TO CHANGE by Mary Hoffman, December 1987 EPA/IMSD-87-011 13- TECHNICAL EXPERT TURNED MANAGER by Mary Hoffman, March 1987 26 ------- |