United States
Environmental
Protection Agency
Office of Acquisition Management
2005 Edition
CONTRACTING OFFICER'S
REPRESENTATIVE (COR)
TRAINING COURSE TEXT
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2005 Edition
Presented by:
Office of Acquisition Management
Acquisition Training and Purchase Card
Service Center (3802R)
Name: Ws
Date: JliN 21, HJflS
Instructor:
Location:
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FORWARD
1. Purpose of the Course
This course is designed to provide practical application and analysis that will enable
Contracting Officers' Representatives (COR) at the Environmental Protection Agency (EPA) to
perform their contract management roles effectively. EPA spends much of its budget on the
extramural activities of assistance and acquisition: grants, cooperative agreements and contracts.
Effective management of contracts is every bit as important a function to government agencies
with heavy use of contract support as is the internal administration of agency staff. The focus of
this course is the post-award, contract administration phase of contracts management.
The course text is intended to support the classroom instruction, assist CORs in
developing competency in their COR duties, and to serve as a desk reference once CORs are on
the job. In addition, the course text provides some application and analysis using practical
exercises to aid in the developing of competence of the COR functions. Once the COR has
completed the course, OAM recommends the COR be assigned an experienced COR to mentor
them for their first six months in on-the-job training.
2. Organization and Contents of the Course
This text consists of the following modules:
Chapter 1 - Basics of Contracts and Role and Responsibilities
Chapter 2 - Special Contract Clauses
Chapter 3 - Preparation of Work Assignments, Delivery/Task Orders
Chapter 4 - Reviewing the Contractor's Work Plan
Chapter 5 - Monitoring the Contractor's Performance
Chapter 6 - Financial Monitoring (Invoice Review Process)
Chapter 7 - Establishing Project Files & Handling Sensitive Information
The chapters are organized in a common format, including the purpose of the chapter and
detailed descriptions of the various roles, procedures, guidelines, issues and problems associated
with the various contract administration management tasks. Checklists, worksheets, and samples
of various forms are included as appropriate.
The bulk of classroom hours are to be devoted to hands-on exercises to apply and analyze
the various principles, practices, and issues involved in contract, Work Assignment,
Delivey/Task Order management.
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3. Comment on Text and Updating Course Manual
The contract administration process is a highly dynamic one. This document is intended
to be not only a student text but also a convenient-to-use reference manual. The Manual will be
available on the OAM Intranet page as a "read only" Adobe Acrobat "pdf' file at
http://dcrroam05.reagan.epa.gov:9876/NATAPPS/QARM/QAM/TRNCARD/TrainingWebDB.n
sf. The Acquisition Training and Purchase Card Service Center (ATPCSC) intends to update this
course on an annual basis incorporating any changes at the Federal, Agency, or Office of
Acquisition Management (OAM) level that affect the contract management process. If you have
ideas for future topics, material for case studies, or other suggestions, note them on your course
evaluation. Or, you may send them to the OAM Course Director, Mark Heare. Mark can be
reached by e-mail at heare.mark@,epa. gov or at Acquisition Training and Purchase Card Service
Center, 3802R, 1200 Pennsylvania Ave, N.W., Washington, DC 20460.
4. Administrative Information
A. A student cannot miss more than 1 hour of instruction per day and receive a certificate.
B. This is a three day course. Hours are 8:30 a.m. to 3:30 p.m. unless the instructor indicates
otherwise.
1. Lunch - 1 hour
2. Breaks (At the discretion of the instructor)
.3. All students are expected to return to the classroom on time from lunch and breaks.
C. There is a final exam on the afternoon of the 3rd day. A passing score of 76% is required
to receive a certificate.
D. CLASS DISCUSSION:
1. All students have the privilege to debate with discretion on any topic related to the
course. Therefore, each student, within the bounds of courtesy and propriety, is
encouraged to participate freely in class discussions.
2. Statements in class will be treated as privileged information not to be attributed to a
specific individual when outside the class.
E. STUDENT EVALUATION OF COURSE:
Student critiques are used to evaluate and update the course content. Evaluations will be
collected at the conclusion of the class. The importance of the course evaluation, by each
student, cannot be overemphasized.
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5. Useful Acquisition-Related Web Sites
http://www.gsa.gov/stafWtraining.html-
Federal Acquisition Institute (FAI)-site of COR Mentor Program and other on-line acquisition
courses
http://www.arnet.gov
AcqNet-Locate acquisition-related information and websites
http://www.arnet.gov/far
Federal Acquisition Regulation (FAR)-Search/Print FAR
http://www.fedbizopps.gov
FedBizOpps-where Federal agencies advertise their procurement opportunities over $25,000 and
other procurement related meeting, sources sought, etc.
http://www. gsaelibrarv. gsa. gov
GSA Schedules e-Library GSA Federal Supply Service-Search Federal Supply Schedules
http://www.fac.gov/
The Federal Acquisition Council site - a diverse group of acquisition professionals in the
Executive Branch established to provide a senior level forum for monitoring and improving the
federal acquisition system.
http://fillform.gsa.gov/
General Services Administration (GSA) Forms-Obtain forms including GSA, Standard (SF), and
Optional Forms (OF)
http ://epls. arnet. gov/
Excluded Parties Listing System (EPLS)-Search for suspended and debarred contractors
http://www.sba.gov/
Small Business Administration (SBA) Homepage-Obtain information on the Small Business
Administration and its related programs
http://wifcon.com
Where in Federal Contracting?- Information site for everything acquisition-related.
http ://intranet. epa. go v/fdw/
Financial Data Warehouse-Obtain information related to invoices and other financial related
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topics regarding contracts
www.usoge.gov
U.S. Office of Government Ethics - Ethics regulations & guidance, OGE Form 450, Confidential
Financial Disclosure
www.dau.mil
Defense Acquisition University
www.gao.gov
General Accounting Office Home Page
6. Intranet Access to OAM Acquisition Guidance
The following information is available at http://intranet.eDa.gov/oamintra/policv/index.htm
• Acquisition Training Information
• Best Practices Guide for Conferences
• Contracts Management Manual *
• EPAAR (EPA Acquisition Regulation) Supplement to the Federal Acquisition Regulation (FAR)
• EPA Order 1901 -1A Use of Contractor Services to Avoid Improper Contractor Relationships
• Executive Order 13123 Greening the Government Through Efficient Energy Management
• Governmentwide Acquisition Contracts (GWACS) and Other Alternative Contractual Vehicles
• Independent Government Cost Estimates - A Student Text Guide
• National Institutes of Health (NIH) Contractor Performance System
• Policy Hot Tips
• Procurement Policy Notices
• Proposed and Draft - proposed and draft policy documents for which OAM is requesting comments
• Purchase Card Program Web Page: This is a link to the official EPA website for all Purchase Card
news and guidance.
• Simplified Acquisitions Made Easy
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• Small Business Administration Programs - (Agency Goals)
• Virtual Acquisition Research Center
7. Note about the Contracts Management Manual (CMM)
The OAM Policy staff has renumbered our directives to follow the Federal Acquisition
Regulation numbering system. The CMM is posted on the intranet at
http://intranet.epa.gov/oamintra/. CMM chapter numbers will change as follows:
Old
New
Chapter Title
1
7
Acquisition and Contract Management Planning
2
7
Procurement Initiation and Related Documentation
3
15
Unsolicited Proposals
4
13
Blanket Purchase Agreements
5
45
Providing Government Property
6
11
Invoice Review Process
7
42
Contracting Officer Representatives
8
1
Contracting Officer Warrant Program
9
7
Accounting for Appropriations in Contracts
10
42
Management Integrity in Acquisition Systems
11
24
Safeguarding Bids and Proposals
12
1
Ratification of Unauthorized Commitments
13
23
Affirmative Procurement Program
14
Reserved
15
16
Use of Cost-Pius-Award-Fee Contracts
16
16
Multiple Award Contracts
17
Reserved
18
44
Prohibition on Directed Subcontracting
19
Reserved
20
42
Shutdown Procedures
21
11
Statements of Work
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8. FORMS, FORMS, FORMS
Agency forms can be obtained in hard copy or electronic'form from the intranet at the "Forms at
Your Desktop" site on http://intranet.epa.gov/nrmp/forms. The site offers:
1. EPA Printable PDF Forms - A full listing of the forms available in PDF format for viewing
or printing, organized by EPA form number.
2. Fax On Demand Forms - Fax-on-Demand using the EPA Voice Processing System (VPS)
3. Forms in Hard Copy - Processes, locations and contacts for obtaining hard copy forms.
4. Other Government Forms - U.S. Government Standard Forms (SF) or Optional Forms
(OF).
EPA "fill and print" forms are available in E-Forms—if it has been implemented in your office.
The E-Forms Help Desk can be reached on 571-228-0981.
9. A Note About Terminology
Throughout this text, we will use the term Contracting Officer's Representative or COR. This is
the Governmentwide term for individuals who are appointed by the Contracting Officer (CO) to
manage a contract, work assignment, task order or delivery order. EPA uses the following titles:
Old Title
New Title
Contractual Instrument
project officer (PO)
contract-level COR
basic contract
work assignment manager (WAM)
work assignment COR
work assignment
task order project officer (TOPO)
task order COR
task order
delivery order project officer (DOPO)
delivery order COR
delivery order
The Federal Acquisition Regulation defines a "task order" as an order for services placed against
an established fixed rate, labor hour or time and materials contract. A "delivery order" is an
order for supplies. "Work assignment" is an Agency term for an order for services under a cost-
reimbursement contract.
Generally, the PO manages the basic contract, assists WAMs or DO/TOPOs ordering work under
the contract, and handles crosscutting issues. POs also play an active role in acquisition
planning, preparing requirements, and evaluating offers in the pre-award phase of contracting.
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The form used to nominate you as a COR, thel900.65, Nomination of Contracting Officer
Representatives, is provided in Chapter 1.
10. Our Customers
The chart below lists the OAM service centers by division and the program offices we serve.
Headquarters Procurement Operations Division
Acquisition Service Center
Program Office Customer
Administrative Contract Service Center
For Headquarters locations only:
Office of Air and Radiation (OAR)
Office of Administration and Resources Management (OARM)
Office of the Chief Financial Officer (OCFO)
Office of Enforcement and Compliance Assurance (OECA)
Program Contract Service Center
Office of the Administrator (OA)
Office of General Counsel (OGC)
Office of Inspector General (OIG)
Office of International Affairs (OIA)
Office of Policy, Economics, and Innovation (OPEI)
Office of Prevention, Pesticides, and Toxic Substances (OPPTS)
Information Resource Management
Procurement Service Center
Office of Environmental Information (OEI)
National Procurement Contract Service
Center
For Headquarters locations only:
Office of Research and Development (ORD)
Office of Water (OW)
Superfund/RCRA, Regional Procurement Operations Division
Note: The organizations listed below are a part of the Office of Solid Waste and Emergency Response (OSWER)
unless otherwise noted.
Acquisition Service Center
Program Office Customer
Laboratory Analysis Service Center
Analytical Operations and Data Quality Center
Headquarters Contract Service Center
OSWER Assistant Administrator, Acquisition and Resource
Management Staff, Contract Management Center, Human and
Organizational Services Center, Office of Program Management,
Office of Brownfields Cleanup and Redevelopment, Office of Solid
Waste, Organizational Management and Integrity Staff, Policy
Analysis and Regulatory Management, Program Analysis and
Resources Management Center, Technology Innovation Office
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Program Management and Regional
Coordination Service Center
Community Involvement and Outreach Center, Federal Facilities
Restoration and Reuse Office for the Office of Enforcement and
Compliance Assurance (OECA) - Federal Facilities Enforcement
Office, RCRA Enforcement, Office of Site Remediation
Enforcement
Emergency Response Contracts Service
Center
Chemical Emergency Preparedness and Prevention Office,
Environmental Response Team Center, Office of Emergency and
Remedial Response, Oil Program Center, Office of Underground
Storage Tanks, State, Tribal, and Site Identification Center, Regions
1-10 Accelerated Response Center
Research Triangle Park Procurement Operations Division
Acquisition Service Center
Program Office Customer
Office of Research and Development
Service Center
ORD's National Health & Environmental Effects Research
Laboratory, National Exposure Research Laboratory, and all ORD
offices in RTP-except for National Risk Management Research
Laboratory and National Center for Environmental Assessment
Office of Air and Radiation Service
Center
All Office of Air and Radiation offices in RTP
Office of Administration and Resources
Management-RTP Service Center
OARM-RTP, OCFO-Financial Management Center-RTP, Office of
Civil Rights-RTP, OGC-RTP, and OEI's National Technology
Services Division-RTP
Cincinnati Procurement Operations Division
Acquisition Service Center
Program Office Customer
Office of Water Service Center
Technical Support Center in Cincinnati, OH
Office of Research and Development
Service Center
National Risk Management Research Laboratory, National Center
for Environmental Assessment-except National Center for
Environmental Assessment in Washington, DC
Office of Administration and Resources
Management/Office of Air and
Radiation/Office of Solid Waste and
Emergency Response Service Center
All construction/A&E Agency requirements, OARM in Cincinnati,
Office of Transportation and Air Quality in Ann Arbor, MI, and
Environmental Response Team in Edison, NJ
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11. Policy, Training, and Oversight Division (PTOD)
Unlike the other OAM divisions, which provide procurement operations support to the Agency
program offices, PTOD supports both OAM itself and the program offices. The division is
comprised of three service centers which provide support in the areas listed.
A. Policy and Oversight Service Center (POSC)
POSC is responsible for issuing and interpreting Federal and Agency acquisition regulations and
directives; reviewing and recommending deviations to procurement regulations; managing
environmental contracting issues; representing EPA on the Civilian Agency Acquisition Council;
and additional FAR Committees; coordinating FMFIA reporting for OAM; conducting oversight
reviews; administering the contractor past performance system; reviewing Conflict of Interest
(COI) issues; responding to Freedom of Information Act requests; providing for bid and proposal
receipt; distributing contract documents; and managing a centralized file room for official
contract files.
B. Acquisition Training and Purchasing Card Service Center (ATPCSC)
ATPCSC is responsible for policy and guidance on the Agency Procurement Professional
Program; Contracting Officer Warrant Program; certification of Contracting Officer
Representatives; providing acquisition/contract management training; serving as Agency liaison
with the Federal Acquisition Institute; managing the acquisition training data base; managing the
contracting officer warrant data base; planning the Agency budget for cross-cutting 1102
training; coordinating the annual Acquisition Training Conference and other procurement
training sessions; managing the annual contracts management awards program; maintaining an
infrastructure for remote Simplified Acquisition Contracting Officers to receive information,
guidance, training, essential to their positions; administering and oversight of the Agency's
National Purchase Card Program; and the Division's administrative and budgetary
responsibilities.
C. Financial Analysis and Rate Negotiation Service Center (FARNSC)
FARNSC is responsible for performing contract financial monitoring reviews; providing direct
cost and contract-specific audits; managing and performing Contractor Purchasing System
Reviews; managing OAM's contract audit resolution program; assisting contracting,
investigation, and legal offices with specific contract issues, closeouts,. settlements, cost
recovery, etc.; coordinating audit issues, audit policies, and planning for necessary services with
DCAA and EPA's OIG; reviewing and approving indirect cost rates for contractors and State
agencies; administering Agency cost accounting standard matters; addressing cross-cutting
administrative contracting officer issues such as contractor accounting practices and procedures
for estimating, accumulating, and reporting costs, internal control policies/procedures, etc.;
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determining the adequacy of the Contractor's Purchasing System and reviewing contractor
financial statements and monitoring financial capability when necessary; assisting the Grants
Administration Division in determining the Non-profit and local government indirect cost rate
proposals to be reviewed and assisting grantees concerning OMB Cost Circular matters;
performing contract property administration functions such as assisting in the development,
implementation, and interpretation of policy; acting as liaison between Agency and Defense
Contract Management Command on property matters; managing contract property information;
and assisting contracting staff concerning the management of property.
12. Office of Acquisition Management (OAM) Organization Acronyms
ITSC - Information Technology Service Center
PTOD - Policy, Training, and Oversight Division
ATPCSC - Acquisition Training and Purchase Card Service Center
FARNSC - Financial Analysis and Rate Negotiation Service Center
POSC - Policy and Oversight Service Center
HPOD - Headquarters Procurement Operations Division
ACSC - Administrative Contract Service Center
ERMPSC - Information Resource Management Procurement Service Center
PCSC - Program Contract Service Center
NPCSC - National Procurement Contract Service Center
SRRPOD - Superfund/RCRA Regional Procurement Operations Division
HCSC - Headquarters Contract Service Center
LASC - Laboratory Analysis Service Center
PMRCSC -Program Management and Regional Coordination Service Center
SCSC - Superfund Contracts Service Center
RTPPOD - Research Triangle Park Procurement Operations Division
OARM/RTPSC - Office of Administration and Resources Management-RTP Service Center
OARSC -Office of Air and Radiation Service Center
ORDSC -Office of Research and Development Service Center
CPOD - Cincinnati Procurement Operations Division
OARM/OAR/OSWERSC - Office of Administration and Resources Management/Office of Air
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and Radiation/Office of Solid Waste and Emergency Response Service Center
ORDSC - Office of Research and Development Service Center
OWSC - Office of Water Service Center
13. Acquisition-Related Acronyms
A-76 Office of Management and Budget Circular A-76, outsourcing or competitive
sourcing.
AH Allowance Holder
AAS Advisory and Assistance Services
A&E Architect and Engineering (contract)
BOA Basic Ordering Agreement
BOC Budget Object Class
BPA Blanket Purchase Agreement
CAAC Civilian Agency Acquisition Council
CAP Contractor Acquired Property
CCRC Contract Customer Relations Council
CCO Chief of the Contracting Office
CBI Confidential Business Information
COI Conflict of Interest
CERCLA Comprehensive Emergency Response and Cleanup Act
CFR Code of Federal Regulations
CLP Contract Laboratory Program
CMM Contracts Management Manual
CO Contracting Officer
COR Contracting Officer's Representative
COTR Contracting Officer's Technical Representative
CPAF Cost Plus Award Fee (Contract)
CPFF Cost Plus Fixed Fee (Contract)
CPOD Cincinnati Procurement Operations Division
CR Cost Reimbursement or Continuing Resolution
CS Contract Specialist
DCN Document Control Number
DO Delivery Order
DOL Department of Labor
DOO Delivery Ordering Officer
DOPO Delivery Order Project Officer
EPAAR Environmental Protection Agency Acquisition Regulations
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ESAT Environmental Services Assistance Team
ERRS Emergency Rapid Response Service
FAI Federal Acquisition Institute
FAIR Federal Activities Inventory Reform Act
FAR Federal Acquisition Regulation
FCO Funds Certification Official
FDO Fee Determination Official
FFP Firm Fixed Price (Contract)
FMFIA Federal Managers Financial Integrity Act
FR Fixed Rate (Contract)
FSS Federal Supply Schedule
FTE Full Time Equivalent
FY Fiscal Year
G&A General and Administrative Costs
GAO General Accounting Office
GFP Government Furnished Property
GPRA Government Performance and Results Act
GSA General Services Administration
GWAC Government Wide Acquisition Contract
HCA Head of the Contracting Activity
HPOD Headquarters Procurement Operations Division
HUBZone Historically Underutilized Business Zone
I AG Interagency Agreement
IBCA Department of Interior Board of Contract Appeals
ICMS Integrated Contract Management System
ID/IQ Indefinite Delivery/Indefinite Quantity
IFMS Integrated Financial Management System
IGCE Independent Government Cost Estimate
ISO Information Security Officer
IT Information Technology
JOFOC Justification for Other than Full and Open Competition
JRO "Junior" Resource Official also called "SRO support staff'
LH Labor Hour (Contract)
LOE Level of Effort
MAC Multi Agency Contract or Multiple Award Contract
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MER
Management Effectiveness Review
NTE Not To Exceed
OAM Office of Acquisition Management
OARM Office of Administration and Resource Management
OCFO Office of the Chief Financial Officer
ODC Other Direct Costs
OEI Office of Environmental Information
OF Optional Form
OGC Office of General Counsel
OGD Office of Grants and Debarment
OIG Office of Inspector General
OPM Office of Personnel Management
OSDBU Office of Small and Disadvantaged Business Utilization
PBSA Performance Based Service Acquisition
PBC Performance Based Contract
PTOD Policy, Training, and Oversight Division
PEB Performance Evaluation Board
PEC Procurement Executives Council
PIN Procurement Initiation Notice
PO Project Officer or Purchase Order
POI Program Office Interface
POP Period of Performance
POR Performance Observation Report
PR Procurement Request
PRP Potentially Responsible Party
PWS Performance Work Statement
RA Regional Administrator
RAC Response Action Contract
R&D Research and Development (contract)
RCRA Resource Conservation and Recovery Act
RFP Request For Proposals
RFQ Request for Quotes
RMC Resource Management Council
RTPPOD RTP Procurement Operations Division
RTP Research Triangle Park
SACO Simplified Acquisition Contracting Officer
SAP Simplified Acquisition Procedures
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SBA Small Business Administration
SDB Small Disadvantaged Business
SDVOSB Service Disabled Veteran-Owned Small Business
SEE Senior Environmental Employee
SF Standard Form or Superfund
SRRPOD Superfund/RCRA, Regional Procurement Operations Division.
SIRMO Senior Information Resources Management Officer
SPEDI Small Purchase Electronic Data Interface
SRO Senior Resource Official
SOW Statement of Work
TD Task Directive
TDD Technical Direction Directive or Document
TDM Technical Direction Memorandum
TEP Technical Evaluation Panel
TID Technical Instruction Directive
TM Task Monitor
T&M Time and Materials (Contract)
TO Task Order
TOM Task Order Manager
TOPO Task Order Project Officer
WA Work Assignment
WCF Working Capital Fund
WAM Work Assignment Manager
WOSB Woman-Owned Small Business
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The Work Flow and Management Process
Prepare Review Contractor's Establish
WA/DO/TO Technical/ WA/DO/TO File
Package ^ Management/Staffing ^ plan
and Cost Plan
Chapter 3 Chapter 4 Chapter 7
Perform Perform Close out
Technical Financial WA/DO/TO
Monitoring ^ Monitoring ^ Contract
Chapters 2 & 5 Chapter 6 Chapter 7
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COR Training Course Index
15-30 and 45 (STOP WORK) day timeline for work plan review 4-3
1402 1-3
$1 Million 1-18
$100K or greater for simplified acquisitions 3-18
1900-1A 5-19
1-34,
1900-65 COR nomination form 1 -47
1900-8 1-6
2550-19 reed in pink envelopes replaced by EASY 6-1
2-year cycle planning (fiscal), immediate needs 1-3
3 phases 1-3
30 calendar days, PO has to transmit completed form over
NIH Internet system to CO 2-15
450 OGE Ethics form 1 -30
5 calendar days, PO must evaluate past performance 2-14
508 compliance 2-13/14
5-year cycle planning (fiscal) submitted annually, future 1-3
Acquisition Acronyms viii
acquisition choices 1-2
acquisition planning 1-4
acquisition process 1-3
Acquisition vs Assistance 1 -1
Acronymns ix, xiii
administrative fees 1-20
administrative methods of issuing work to a contractor based
on the contract type 1 -5
Advisory and assistant services 1-24
agency contracts 1-15
allocable 6-2
allowable charges 6-2
1-17,
alternative contractural vehicles (problem areas) 1-22
amend WA to add or delete tasks 5-3
annual past-performance evaluations, 25% weight 2-14
anti-deficiency act 1-12
appropriate statutory authority 2-8
appropriations 1-11
Assistance agreement 1-1
Attend meetings - contractors 5-5
award the contract 1 -4
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background checks 2-11
best value 1-4
bilateral modification 1-26
budgeting, cost estimate 1 -3
bundling 1-6
burn rate 5-16
1-29,
Cannot... 5-2
civil and criminal penalties 1-13
clauses address controls for identifying and avoiding conflicts of
interest 2-1
clearly set forth terms 1 -2
closing out work assignments 1 -5
CMM vi
COI checklist for potential problems 2-18
COI clauses 2-2
Commerce Business Daily 1-4
competent parties 1-2
competitive negotaated environment 1-4
competitive procurement process 1-37
completion voucher 7-3
completion form = delivery of specific supply item or service 3-3
2-11
compreshensive procurement guidelines 2-19
2-7/2-10
confidential business information (CBI) ,7-6
conflicts of interest (COI) CO is sole determiner of COI '2-1
consideration (benefit or service 1-2
Contract Administration 1-5
contract basic elements = SOW, IGCE, COR's Nomination
Form1900-65 3-1
Contract between Fed. Gov. & another entity requires... 1-2
Contract Formulation 1-4
contract type = how work is given to Contractor 3-1
contract types 1-5
contract types 1-14
Contracting Authority 1 -3
Contracting Officer's Warrant 1 -3
vii,
1-31,
contract-level COR 1 -38
Contractor furnishes all data and/or property to accomplish tasks 3-16
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contractor services guidance
contracts
controls for management of contracts are OA and record of
reviews
cooperative agreement
COR
COR appointment memorandum, attachment, 1-53
COR nomination and appointment
COR roles
COR works on SOW and IGCE simultaneously
cost analysis/auditors
cost reimbursement contracts
cost reimbursement (CR) for level of effort (LOE) = Work
Assignment (WA)
cost reimbursement, CR = WA or best effort is all that can be
required
from Contractor
cost type
debriefing
debriefing offerors
delegate responsibility
Delegation of Procurement Authority (DPA)
deliverables, reviewing
determine program
direct and indirect costs of doing business
direct labor
Disallowing cost
dollar limitations
DOPO
DPA (Delegation of Procurement Authority)
Dun & Bradstreet
duplicate work should not occur in Project
EAP Procurement Executive (Judy Davis)
jEASY
5-5,
5-25
1-5
3-18
1-1
vii,
1-2,1-31
132
1-49
1-34
1-6,
1-28,
1-43,
1-55
3-1
1-35
7-3
3-1
1-15.
"3-1/2
5-16
1-6
1-4
1-3,
1-33
1-2
5-10,
5-40
1-3
3-19/21,
6-7/8/9
6-7
6-10/111
12, 6-23
1-3
vii
1-2
1-8
3-18
1-2
6-1
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Economy Act 1-21
Electronic Approval System (EASY) 6-1
Elements of a contract 1-2
Energy Star Program 2-12
Environmentally Preferable Purchasing (EPP) 2-12
EPA Administrator 1-2
EPABPA 1-2
EPA Contracting Officer (Tom )'Connell OAM/RTP) 1-2
Ethical Conduct, usoge.gov 1 -29
evaluation proposals 1-4
exercising contract options -1-5
existing agency contract 1-2
FAR requirement 1-2
FBO (Federal Business Opportunities) 1-4
fedbizopps 1-4
Federal Agency Benefit, contract 1-1
Federal Business Opportunities (FBO) 1-4
Federal Grant and Cooperative Agreement Act 1-1
File Plan Sample 7-11
Financial Mgmt Ctr 6-12
1-15,
firm fixed price 5-2
fixed rate (least preferred contract) 1 -16
fixed rate (umbrella) contract, type of order depends on what is
being ordered
Delivery Orders (DO) = supplies; Task Orders (TO) = services
{GSA , FSS and GWAC} 3-112
Forecast Database 1-3
forecasting 1-3
format required by law 1-2
forms vi
funding authorizations 1-5,6-4
G & A (general and administrative) 6-9
goals (EPA 5 goals) 1 -14
government property to contractors 2-15
Government-wide acquisition contracts 1-2
1-13,
GPRA (Government Performance and Results Act) 3-2
grant 1-1
green procurement 2-11
GSA 1-17
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GSA Multiple Award Schedule Contracts
GSA Owner's Manual
GSA procedures for placing an order
GWAC executive agents (currently 5 agencies or 6)
GWACs (Government-wide Acquisition Contracts)
history of agencies ("work smarter, not harder")
I AG (Interagency Agreement)
IGCE (Independent Government Cost Estimate)
IGCE development
IGCE is never provided to the contractor / purpose
Indirect Cost
Individual acquisition
Individual acquisition plan (CO writes)
Information Resource Management
Inherently governmental functions
Internet Web Site
Intranet
invoice review process
issuing contract modifications
IT
key players in contracting process
Labor hours
labor mix should not be suggested by the COR
lawful purpose
legal counsel
Level of Effort (LOE)
lowest-price
MPR
maintaining files and records
making final payment
management controls
market research
meeting minutes
mentoring
1-2
1-23
1-18
1-20
1-17,
1-19
1-7
1-20
3-12,
3-18
3-22
3-17/18
6-9
1-3
1-4
2-13
2-2, 2-3
iv
vi
6-1, 6-4,
6-12,
6-18/19
1-5
1-19,
2-13
1-35
5-17
3-17
1-2
1-35
3-3, 6-6
1-4
6-3
7-1
1-5
2-5
1-3, 1-4,
1-6, 1-7,
5-19,
5-41
1-33
XX
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1-5,
micro-purchases 1-14
mixed contract 1-16
1-25,
modifications and amendments 4-9
monitoring contractor's financial & technical performance 1 -5
monitoring contractor's performance 5-1
1-2,
Multi-Agency contracts (MACs) 1-20
1-16,
multiple award 4-1
negotiated procurement 1-6
negotiation is conducted by the CO ONLY! 4-7/8
negotiation vs clarification 4-8
OAM Org. Chart viii
OGC (Office of General Counsel)
options 1-24
ordering work 1-5
orders over $2,500 1-19
Organization Acronymns ix
Outcome of work becomes apparent as work proceeds 3-14
overall responsibility 1-5
Overview 1-1,1-2
2-10,
past performance databases (3) 2-14
Performance Based Service Acquisition (PBSA) results oriented 3-4
Performance Standards 3-7
Performance Work Statement (PWS) is a SOW for performance 3-6
5-11,
Performance, reviewing 5-40
Personal Liability 5-3, 5-7
5-3,
Personal Services 5-22
Phase 2 1-4
Phase 3 1-4,1-5
PIN (procurement initiation notice) (process) 1-6,1-8
Planning 1-3
PO vii
POP (Period of Performance) 1-25
PR (Procurement Request/Order) 1-6
pre-award process overview 1-5,1-6
xxi
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preparing, issuing the solicitation 1-4
President 1 -2
Primary research 1-7
principal purpose grant 1-1
printing in-house, GPO regulation-not EPA 2-16
process of obtaining work from contractor 3-1
procurement authority 1-2
procurement initiation 1-19
procurement initiation notice (PIN) 1 -6
Procurement Process flowchart 1 -37
Procurement Request/Order (PR) 1-6
5-11,
Progress Reports 5-13,6-3
Prompt payment act 6-1
property specialists 1-35
Publically displayed 1-3
publicizing the requirement on FBO 1-4
purse strings 1-11
Quality Assurance Surveillance Plan (QSAP) 3-9
Quality of contractor is COR responsibility 2-13
ratification 5-7
reasonable cost 6-3
recertification course every 3 years 1-49
record categories 7-1
records retention 7-2
recycle 2-12
reference manuals can be identified by COR for use by the
Contractor 3-17
request for quotes (RFQ) 1-18
requirements package 1-38
responding to protests 1-4
1 -18,'4-
RFQ (Request for Quotes) 1
sealed bidding 1-6
Secondary research 1 -8
SEE 5-6
sensitive information 7-4, 7-9
sensitive/vulnerable functions 2-5, 2-6
seven steps to performance based services acquisition,
arnet.gov 1-8
xxii
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simplified acquisition $100K 1 -6
1-5,
simplified acquisitions 1-14
SIRMO (Senior Information Resource Management Official) 2-14
Site visits 5-17
skill mix, e.g., est. hours by labor category or professional level 3-17
skill requirement specified in contract 3-17
small business 1-3
small business set-aside 1-9
1-3,
socioeconomic 1-10
Sole Source 1-6
soliciting offers 1-6
source selection 1 -3
source selection 1 -4
source selection 1-4
source selection, purpose of 1-4
source selection, two basic approaches 1 -4
SOW (Statement of Work) most critical element of the WA, TO or 1-5,
DOpkg. 3-11/12
Start work on tech and cost plan while tech and cost work plans 4-1 and
are being reviewed 4-2
Start work prior to CO signing WA/EO/TO is NOT allowed 4-11
1-3, 1-5,
Statement of Work (SOW) - 3 types 3-3
Statement of Work (SOW) Quality Assurance Review Form
Statutory Limit 60 months or 5 years unless Congressional
approval received 1-24
streamlined procedures, reduces acquisition lead time 1-18
Subtracting - team subcontractor 5-8/9
super fund 1-11
6-12,
Suspended costs 6-25
tasking documents 1-5
technical direction - must be written record, confirmed in 5 5-3,
calendar days 5-36
Termination for convenience of the government 6-6
terminology vii
Thomas Register 1 -8
TOPO vii
trade secret 2-8
xxiii
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4-5, 5-5,
Training for contractors 6-8
Unauthorized commitment actions 5-6
unbiased work product from contractor (COI) Regulatory Agency 2-1
unilateral modification 1-26
US Constitution 1-2
Use of government equipment and property by contractor 6-8
WA and DO/TO difference 4-11
WAM vii
Work Assignment (SOW), develop; require WP from contractor 3-1,4-1
Work Flow Process xvii
Work Package, preparing and asdsembling 3-25
Work Plan - compare hours/skill levels with IGCE 4-4
Work Plan check for additions, deletions and changes 4-4
Work Plan Elements; Review - Timelines, MEETING OF THE 4-2 and
MIND! 4-3
Work Plan Review Checklist 4-13
Work Plans submitted by a contractor 4-1
Written authority 1-3
xxiv
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Chapter 1 - The Basics Of Contracts and Roles and Responsibilities
1. Introduction
When a Federal agency has decided that a need for supplies or services cannot be met by
in-house resources, that need is met by using sources outside of the Federal Government (private
industry, non-profit organizations, and colleges/universities). Because the supplies and services
are obtained using public monies, Congress employs their Constitutional legislative authority to
prescribe the methods to be used in the acquisition process.
This chapter provides an overview of the activities involved in the process to obtain the
necessary supplies and services via the acquisition process. This activity covers a wide-range of
steps from the initial definition of the Government's requirements, through the phases involved
in the decision-making and constraints involved, and ending with the award of a contract or
contracts. This Chapter also provides an overview of the fundamentals of contracts, statements
of work (SOW), funding authorizations, contract types including micro-purchases, simplified
acquisitions, the various kinds of tasking documents. Also addressed are administrative methods
of issuing work to a Contractor based upon the contract type.
Additionally, this chapter discusses the roles and responsibilities of the Contracting
Officer Representative (COR) in performing the overall contract management functions and to a
limited degree those other key players (Contracting Officer, property expert, auditors, legal
counsel, etc.) involved in the acquisition process.
2. Acquisition versus Assistance
Guidance on the proper use of contracts and cooperative agreements is given in: EPA
Order 5700.1, "Policy for Distinguishing Between Acquisition and Assistance", dated March 22,
1994. In addition, your AAship or Region may have its own supplemental procedures manual.
Under Section 4 of the Federal Grant and Cooperative Agreement Act (FGCA), 31 U.S.C. 6303,
a contract must be used if the principal purpose is to acquire property or services for the direct
benefit or use of the Federal Government. Conversely, under Sections 5 and 6 of the FGCA, 31
U.S.C. 6304 and 6305, an Agency may use an assistance agreement (cooperative agreement
or graijt), only if the principal purpose is to transfer a thing of value to an eligible recipient to
carry out a public purpose of support or stimulation authorized by law.
Among grants and cooperative agreements, if substantial involvement by the Executive
Agency with the recipient is expected, a cooperative agreement must be used. Therefore, the l AG-
primary criterion in choosing a contract versus a grant/cooperative agreement is what the
principal purpose is. If the principal purpose is to obtain a product or service to support a
Federal agency, a contract must be used, even if the project also benefits the recipient, other
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non-Federal organizations or the public. More details on the various types and uses of
cooperative agreements is provided on the Office of Grants and Debarment Web Page at
http:// www, epa. gov/ o gd/index.htm.
If the decision is acquisition, then the choices are:
1. Existing Agency contract;
2. GSA Multiple Award Schedule contracts;
3. EPABPAs;
4. Government-wide Acquisition contracts; or
5. Multi-Agency contracts.
For the purposes of this course, the text assumes your requirement's principal purpose is to
support the EPA's mission, and that an existing Agency contract will be used. What follows are
the next steps in the process based upon that assumption. For guidance on how to access the
other vehicles, talk to the CO that supports you program office.
3. Definition of a Contract
A contract is a legally binding agreement between two entities that must contain the
following elements in order to be valid:
1. Competent parties
2. consideration, ^
3. lawful purpose,
4. clearly set forth terms, and
5. in a format required by law.
This definition of a contract applies whether discussing private party agreements,
commercial agreements, or agreements between the Federal government and another party.
Federal contracts can be between the Federal government and other governmental agencies (e.g.,
Federal, State or Local), private industry, individuals, educational institutions, or non-profit
organizations. A contract between the Federal government and another entity requires the
Government to pay for the supplies and/or services delivered. It further requires the Contractor
to perform successfully and provide the supplies and/or services in a timely manner. The
Government must not unreasonably interfere with or delay a Contractor's performance.
4. Procurement Authority
The authority for all Federal government contracts arises from the inherent powers
granted by United States Constitution and is delegated from the head of the Executive Branch to
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the heads of all Executive Departments and Independent Agencies. Because of the immense
power and legal burden placed on the Federal government involved in entering into these
agreements, there has to be a clear, delineated line of delegated authority. All authority for
contractual actions derive from delegations of procurement authority (DP A) from the President
of the United States to the Administrator of the EPA. From there the delegation flows down to
the Procurement Executive, Director of the Office of Acquisition Management (OAM), and on
down to designated personnel within OAM or specially designated individuals outside of OAM.
Contracting authority can be either limited or unlimited. Each individual with a DPA authority
receives it in writing. The DPA sets forth dollar limitations on what that individual's authority is
to bind the Government.
Individuals issued a DPA are agents of the Federal government. These agents are called
Contracting Officers (CO) and have the authority to enter into a mutually binding relationship
that obligates the Contractor to furnish supplies and/or services and the Government to reimburse
the seller for those supplies and/or services. COs receive a "Contracting Officer's Warrant," on a
Standard Form 1402 that must be publically displayed.
Not only must all authority be delegated in writing, but individuals can't act in such as
way as to convey authority where none exists. It must be "actual" authority. Depending on
what the a warrant and DPA confer, a CO can have the authority to enter into, administer,
modify, or terminate a contract. Only individuals with a DPA are authorized to take these
actions on behalf of the Federal government. A CO can only bind the government up to the
limits of his/her DPA. COs can never enter into any agreement that is prohibited by law or in
excess of their DPA. COs usually delegate responsibility for certain actions related to technical
direction, invoice review and payment, and inspection and acceptance. This delegation is in
writing, and can cover other actions as well depending on the contract type.
5. Breakdown of the Acquisition Process 3 •
A. Acquisition Planning
Acquisition planning involves (1) Acquisition forecasting, (2) Market research, (3)
Describing the requirement (statement of work, performance standards, and so forth), (4)
Budgeting for and developing the independent Government cost estimate, (5) Developing source
selection criteria, and (6) Determining whether to set aside for a small business or socioeconomic
program.
Advanced planning is essential to the acquisition process. At the EPA, acquisition
planning is done on a five year cycle. Acquisition plans that outline proposed acquisitions
prospectively for the next 5 fiscal years are submitted by program offices on an annual basis.
Offices provide acquisition forecasts that synopsize the planned acquisitions for the first 2 years
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of the 5 year acquisition planning period.
Each individual acquisition over certain dollar thresholds requires an individual contract
management plan that discusses how a specific contract, once it is awarded, will be managed.
(See the Contracts Management Manual for dollar values). EPA requires each individual
acquisition over a certain dollar value to have an individual acquisition plan using the format set
forth in the FAR, Part 7. (See the Contracts Management Manual for dollar values.)
Acquisition planning and market research are used to maximize competition, integrate the
efforts of all personnel responsible for the acquisition, and to ensure that needs are met in the
most effective and timely way with decisions based upon the best value for the public monies.
The CO is responsible for writing the overall individual acquisition plan, but he/she relies on the
input of significant, detailed information from the requiring activity.
B. Contract Formulation
F
Once the Government has recognized a requirement, the program office prepares the
necessary and appropriate paperwork and submits it to the contracting office for processing. The
contracting staff will review the paperwork and start the process. The steps in the contract
formulation phase involve: (1) Publicizing the requirement on the Federal Business
Opportunities web site at http://www.fedbizopps.gov/. (2) Preparing and issuing the solicitation
(3) Evaluating proposals, (4) Source Selection, (5) Awarding the contract, (6) Debriefing
offerors, and (7) Responding to protests (as necessary).
Source selection is the process of soliciting and evaluating offers for award in a
competitive negotiated environment. The purpose of source selection is:
1. maximize competition
2. minimize the complexity of the solicitation, evaluation, and selection decision
3. ensure impartial and comprehensive evaluation of all offerors' proposals, and
4. ensure selection of the source whose proposal has the highest degreee of realism and
whose performance is expected to best meet stated Government requirements.
There are two basic approaches to source selection:
1. Lowest-Price Technically Acceptable Proposal - under this approach, all of the
evaluation factors, except price, are, in effect evaluated in a "Go, No Go" basis. It is appropriate
when price is properly the deciding factor once the technical acceptability of offerors has been
determined. "Go, No Go" factors define a standard of comparison for contract requirements
which proposals either satisfy completely or fail to meet.
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2. "Best Value" Concept - is an approach that considers the appropriate balance of
technical merit, management capacity, and cost factors for a specific requirement that will
provide the "best value" to the Government. There may be a trade-off of higher price for a better
supply or service.
C. Contract Administration
Contract administration encompasses all functions relating to a contract from the moment
it is awarded until final payment has been made and the contract is closed out. Here at EPA,
some contract administration duties are delegated by Contracting Officers to program office
Contracting Officer Representatives (CORs). Because program CORs are entrusted with much
of the contractor oversight required, an understanding of the principles and duties involved in
contract administration is essential.
Effective contract administration requires direct liaison between the Contracting Officer
and the COR during the entire life of a contract, work assignment, delivery/task order. This team
concept is critical to a successful contract document. It is important to remember that the
Contracting Officer has overall responsibility for obtaining satisfactory contract performance.
But with close cooperation and an understanding of his/her duties, CORs can help assure better
results and a more successful accomplishment of the program mission.
Contract Administration involves: (1) Ordering work under the contract, (2) Monitoring
the contractor's financial and technical performance, (3) Exercising contract options, (4) Issuing
contract modification, (5) closing out work assignments, and (6) making final payment.
Most Agency CORs perform tasks in the contract administration phase. Some POs will
be involved in the acquisition planning phase and portions of the contract formation phase. The
various types of CORs and which functions they perform are described in more detail in the next
section.
6. Overview of the Pre-Award Process
The pre-award process consists of the various activities associated with placing contracts
between two parties (Exhibit 1-1 on page 1-37). They encompass:
a.
Planning Procurements.
b.
Determining the Requirements.
c.
Describing the supplies or services needed.
d.
Conducting Market Research.
e.
Deciding on an acquisition strategy and developing a plan.
f.
Putting together a Procurement Initiation Notice (PIN) package including, but not
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limited to the: SOW, procurement request funding document, management
controls when acquiring advisory and assistance services (See section 27 in this
chapter), quality assurance plan, contract administration plan.
g. Establishing evaluation criteria for proposals and source selection personnel.
h. Issuing the Invitation for Bids (IFB) or Request for Proposals (RFP).
i. Receipt and opening of bids or receipt and evaluation of proposals.
j. Deciding whether to award a contract without discussions/negotiations,
k. Determining which Offerors are competitive if not awarding on initial offers and
setting a Competitive Range. (For debriefing of unsuccessful Offerors, see
NOTE #2 after "q.")
1. Negotiating technical and pricing issues.
m. Public opening of bids and determining which is responsive and lowest price in
the sealed bidding process, or which Offeror (or Offerors) is acceptable and
provides the best value to the Government when using negotiated procedures,
n. Obtaining all required clearances,
o. Awarding the Contract/Contracts,
p. Debriefing all Offerors who request one.
q. Resolving award protests if any.
NOTE: 1 -When sealed bidding is the solicitation method used, items "j" through "1" and
"p" above are not part of the process.
2 -If a negotiated procurement is the method used, when an Offeror is determined
to be no longer competitive, they must be notified, and are entitled to request a debriefing on
why they were no longer being considered for a possible award. The CO may determine that it's
in the Government's best interests to delay any debriefing until after contract award.
7. The Procurement Initiation Notice (PIN) Process
The PIN process has been developed at the EPA as a method to be used by program offices and
the Office of Acquisition Management to work through the pre award phases. NOTE: For a
complete explanation of the PIN process, see the Chapter 2 of the Contracts Management
Manual at http ://intranet.epa. gov/oamintra.
8. Market Research
a. "Market research" means collecting and analyzing information about capabilities
within the market to satisfy agency needs. Market research is an integral, ongoing, and
mandatory part of the acquisition process. Contact with vendors and suppliers for purposes of
market research is now encouraged. In fact, FAR Part 10 requires that agencies conduct market
research appropriate to the circumstances before:
1-6
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(1) Developing new contract requirements (a procurement request or procurement
initiation notice);
(2) Soliciting offers for acquisitions with an estimated value in excess of the
simplified acquisition threshold ($100,000);
(3) Soliciting offers for acquisitions with an estimated value below the simplified
acquisition threshold when adequate information is not available and the circumstances justify
the cost of the market research; and
(4) Soliciting offers for acquisitions that could lead to a bundled contract.
Bundling" is consolidating two or more requirements for supplies or services, previously
provided or performed under separate smaller contracts, into a solicitation for a single contract
that is likely to be unsuitable for award to a small business concern.
b. Often the COR will conduct market research while developing the procurement
initiation notice (PIN) for a new or follow-on contract, or completing an EPA Form 1900-8,
Procurement Request/Order (PR), for a sole source simplified acquisition. CORs should
document their market research efforts, including conversations with vendors. The CO may
request this information later.
c. Market research can provide information in the following areas:
(1) Industry capabilities, new technologies and innovative practices;
(2) Customary practices, including warranties and discounts;
(3) Industry standards, performance metrics and measures;
(4) Market prices and pricing trends;
(5) Availability of sources and market trends;
(6) Locating small business concerns; and
(7) Purchasing histories of other agencies, including: pricing and contract
performance data, standard contracting terms and conditions; problems and issues in the award
and administration of prior contracts.
This research can provide valuable information on industry concerns or questions, what type of
contract to use, necessary contract terms, ideas for improving the statement of work, standards
for evaluating performance and so forth.
d. Market research may be conducted by directly communicating with individuals or by
using secondary sources.
(1) Consider exchanging tips and information with counterparts at other federal or state
1-7
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agencies. Industry representatives also can provide valuable information. Site visits to and
discussions with firms can help you get a better feel for the realities of the industry than you can
get by relying solely on advertising brochures and sales pitches. It may also give you an
opportunity to talk to a firm's technical representatives as opposed to the marketing people.
Seek out professional and trade societies, research institutes, universities, technical conferences,
symposia, industry consortia, etc. where you can discuss state-of-the-art of the technology,
technical standards, protocol, etc.
(2) If you plan a one-on-one meeting with a contractor for the purpose of conducting
market research, it is advised that you let your CO know and that you inform the company
officials that:
(a) We are meeting for informational purposes, to conduct market research. We
will research other firms as well.
(b) Only Agency contracting officers have authority to award contracts.
(c) The Agency is not promising any business to the firm, the FAR requires that
all contracts be competed and that our requirements be listed publically on the internet at
http ://www.fedbizopps. gov/.
(3) Secondary research can encompass computer-based and on-line sources and
directories, including a wide variety of industry-specific databases, and professional market
research services. For example, you can search on-line patent records, as well as industry
registers such as Dun & Bradstreet and the Thomas Register. Extensive indexes in these data
bases allow the user to view information on a subject by entering keywords. Subscribing to, and
regularly reading, trade journals for a specific market and maintaining active membership in
professional societies can help as well. The Agency library staff can assist with research, locating
data, and finding additional resources. If your office can afford it, there are also companies that
prepare market surveys providing information on a specific technology or commodity.
9. Want to Learn More About Market Research?
Extensive reference material on market research can be found in the Seven Steps to
Performance Based Services Acquisition on the internet. To locate it, go to
http://www.arnet.gov/ then select "Seven Steps to Performance Based Services Acquisition
Guide" in the lower, left-hand corner of the screen, go to "Step 3." Under "Additional
Information" there are links to on-line training, web sites $bout market research, and guidelines
on conducting market research.
10. Set-Aside Programs
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a. The Small Business Act established the Small Business Administration (SBA) and
rested the overall responsibility for all small business programs with the SBA. All small
business programs, discussed briefly here, are covered in greater detail in FAR Part 19. The
SBA establishes small business size standards on an industry-by-industry basis as defined by the
North American Industry Classification System (NAICS) Manual which best describes the
principal nature of the product or service being acquired. The SBA is responsible for the
designation of the geographic areas for certain set-aside programs and for certification of
businesses for each of the set-aside programs.
b. The Act requires all Federal agencies with contracting authority to establish an Office
of Small and Disadvantaged Business Utilization (OSDBU). The EPA OSDBU sets the goals for
the entire Agency based upon Congressional and Executive Branch mandates. Each program
office at the EPA is responsible for establishing its own socioeconomic goals for each set-aside
program but those goals must be equal to or exceed the Agency goals.
c. The Federal policy is to provide maximum practicable opportunities in its acquisitions
to small businesses, small-disadvantaged businesses, HUBZone (historically underutilized
business) businesses, service disabled veteran businesses, and women-owned small businesses.
Congress established small business set-aside programs based upon the rationale that more than
90% of the private sector is small business, and that a healthy small business community is
essential for the health of the entire nation. There are several individual programs created
under that Act:
11. The Small Business Set-Aside
a. Each acquisition that has an expected dollar value in excess of $2,500 but not
more than $100,000 (the current SAT), is automatically reserved exclusively for small
business concerns and shall be set aside for small business unless the contracting officer
determines there is not a reasonable expectation of obtaining offers from two or more responsible
small business concerns that are competitive in terms of market prices, quality, and delivery.
b. Contracts over $100,000 may be set-aside to award exclusively to small business
concerns if the contracting officer determines there is a reasonable expectation of obtaining
offers from two or more responsible small business concerns that are competitive in terms of
market prices, quality, and delivery. Furthermore, when the CO synopsizes small business set-
asides, we will notify the offerors that our plan is to and award a small business set aside,
however, in accordance with FAR 19.5, if we find 2 or more qualified HUBZone or Services
Disabled Veteran Businesses we will limit the competition to them.
12. The 8(a) Program
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a. The Small Business Act created also has a program for socially and economically
disadvantaged businesses. Under this portion of the Act, small businesses that are owned by one
of the legally defined minority groups can apply for the program (Caucasian women can also
qualify if it can demonstrate disadvantage). If they are accepted, they can be in this program for
a maximum of 9 years.
b. Acquisitions under the 8(a) Program shall be awarded on the basis of competition
limited to eligible 8(a) firms if-
(1) There is a reasonable expectation that at least two eligible and responsible '8(a) firms
will submit offers and that award can be made at a fair market price; and
(2) The anticipated total value of the contract, including options, will exceed $5,000,000
for supplies and $3,000,000 for services. (Under these amounts, acquisitions may be
awarded on a sole source basis to an 8(a) firm.)
(3) Agencies can enter into sole-source tripartite contracts between the 8(a) firm, the
requiring Federal agency, and the SBA. (NOTE: EPA has executed a memorandum of
understanding with the SBA that allows EPA to contract bilaterally with an 8(a) firm.)
13. The HUB Zone and Service-Disabled Veteran-Owned (SDVB) Business Program
a. The purpose of the HUBZone Program is to provide Federal contracting assistance for
qualified small businesses located in areas designated by the SBA as historically underutilized
business zones in an effort to increase employment opportunities, investment, and economic
development in those areas. A firm must be certified by the SBA and be included on a list at
http://www.sba. eov/hubzone. Acquisitions exceeding the SAT must be set up to restrict
competition to HUBZone businesses whenever the CO has a reasonable expectation that two or
more HUBZone businesses will submit offers and that the award will be made at a fair market
price.
b. The President signed an Executive Order on October 20,2004 to implement the
requirements of the Service-Disabled Veteran-Owned (SDVB) Business Program. The program
honors the service rendered to the United States by veterans with disabilities incurred or
aggravated in the line of duty during active service with the armed forces. It provides certain
benefits for business owned by service-disabled veterans seeking contracts with the federal
government. A government-wide goal of 3% was established for SDVB awards.
c. Acquisitions may be set-aside for competition amongst HUBZone or SDV Businesses,
if two or more qualified offerors exist. If the contracting officer receives only one acceptable
offer from a service-disabled veteran-owned or HUBZone small business concern in response to
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a set-aside, the contracting officer should make an award to that concern.
14. Subcontracting Possibilities
Set-aside programs have individually mandated goals which Federal agencies are
required to meet by law. Additionally, the Act requires that any Contractor which receives a
contract with a dollar value greater than $500,000 ($1,000,000 for construction) must agree to
ensure that small, small disadvantaged, HUBZone, service-disabled veteran-owned, and women-
owned small businesses are afforded an maximum practicable opportunity to subcontract for
performance under that contract. All solicitations in excess of $500,000 that have
subcontracting possibilities must mandate that the successful Offeror have an acceptable
subcontracting plan that incorporates the Agency goals, subject to negotiation.
15. Socioeconomic Goals for Fiscal Year 2005
a. The chart below list EPA's direct procurement and subcontract socioeconomic goals
for Fiscal Year (FY) 2005. Dollar values are based on estimated contract obligations of $1.2
billion for direct and $200 million for subcontract.
Estimated Obligations
Negotiated
DIRECT
Dollar Value
Goal
Small Businesses
$324 M
27.0%
8(a) Businesses
75 M
*6.3%
Non 8(a) Small
Disadvantaged Businesses
36 M
*3.0%
Women-Owned Businesses
60 M
5.0%
HUBZone Businesses
36 M
3.0%
Service Disabled Veteran
Small Businesses
36 M
3.0%
SUBCONTRACT
Dollar Value
Goal
Small Businesses
100 M
50.0%
Small Disadvantaged
Businesses
40 M
20.0%
Women-Owned Businesses
15 M
7.5%
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HUBZones
6 M
3.0%
Service Disabled Veteran
6 M
3.0%
Small Businesses (SDVB)
NOTE: Subcontracting goals are subject to increase in individual solicitations in an effort to
meet overall Agency goals.
*Since 8(a)s are SDBs, EPA, in essence, has an SDB goal of 9.3%.
16. Locating small business sources
a. The U.S. Small Business Administration uses the Central Contractor Registration
(CCR) databases as a portal for entering and searching small business sources. It is the
authoritative source for vendors that are certified in SBA's 8(a) Business Development program,
HUBZone Empowerment Contracting Program and Small Disadvantaged Business program. To
conduct market research and confirm eligibility for SBA's procurement preference programs,
users can now go to the CCR Web site at http://www.ccr.gov/ and click on the "Dynamic Small
Business Search" button. Search can be conducted based on NAICS (North American Industry
Classification System) codes, key words, state, congressional district, business type,
certifications, quality assurance standards, electronic data interchange capability, etc.
b. The Agency's Office of Small and Disadvantaged Business Utilization (OSDBU)
supports Agency personnel and contractors with seeking opportunities to contract with small
business concerns.
c. The "Contract Directory" at http://www.contractdirectorv.gov/GovWide/home.do
provides information on General Service Administration (GSA) Schedule contracts (including
blanket purchase agreements under GSA Schedule), Government-Wide Acquisition Contracts
(GWACs), and Multiple Agency Contracts (MACs) and other procurement instruments intended
for multiple agency use. Searches can be made on product or service code, procurement
instrument, or socioeconomic information
d. Additionally, such concerns must also have the maximum practicable opportunity to
participate as subcontractors in the contracts awarded by any executive agency, consistent with
efficient contract performance.
e. Prime contractors may use the U.S. Small Business Administration Subcontracting
Network or "SUB-Net" to post subcontracting opportunities. These may reserved for small
business, and include either solicitations or other notices, such as, notices of sources sought for
teaming partners and subcontractors on future contracts. Small businesses can review this web
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site to identify opportunities in their areas of expertise. The web site is primarily for large
businesses to post solicitations and notices. Federal agencies, state and local governments,
nonprofit organizations, colleges and universities, and even foreign governments also use it for
the same purpose. The internet site is http ://web. sba. gov/subnet/.
17. Appropriations
Congress controls the purse strings in three different ways: purpose, time, and amount.
Funds are legally available if they meet the following three tests:
a. The purpose of the obligation or expenditure must be authorized;
b. The obligation must occur within the time limits applicable to the appropriation; and,
c. The obligation and expenditure must be within the amounts Congress has established
as to purpose, amount, and time of availability of the funding.
1. Purpose - Public funds may be obligated and expended only for the purpose or
purposes for which they were appropriated by the Congress, or unless some other legislation
provides the authority. While certain funding levels and limitations may be included in
authorizing legislation, appropriation legislation will generally control the funding uses.
However, the authorizing act and appropriations act are supposed to be harmonized to the
greatest extent possible. It is the authorizing legislation that sets the stage for environmental
action, but it's the appropriation legislation that provides and controls the use of Agency funds to
act upon the environmental authorization.
2. Amount - Amount relates to any restrictions or proscriptions placed on the
appropriation. A COR needs to understand what an appropriation can be used for and what it
can't, as well as when it is available (the fiscal years), and how much of it is available for use.
3. Time - Congress has the authority to place time restrictions on Agency funding
by stating that the appropriation is good until the end of a certain fiscal year (fiscal years run
October 1st of one year through September 30th of the following year) or by stating that it is good
until expended, which means there are no fiscal years restrictions attached to the funds.
4. Availability of Appropriations - As stated earlier, Congress sets the time limits
on the availability of any appropriation legislation. Currently for the EPA, Congress provides
appropriations for three basic periods of availability: annual, multi-year, and no-year. Use of any
appropriation must meet the bona fide rule. The bona fide rule provides that an appropriation
may only be obligated to meet a legitimate, or bona fide, need arising in the year for which it was
appropriated. In some cases, the need existed within the appropriation period, but continues
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beyond the expiration date of the appropriation.
A. Annual Appropriations - Annual appropriations (also called one-year appropriations)
are provided for a specific fiscal year and are available for obligation only for that one year
period of time. Annual appropriations are available only to meet a bona fide need of the fiscal
year for which they were appropriated.
Example: The Office of the Inspector General uses Contractors for financial audit
support services. The office has been given the requirement to audit ABC,
Inc. in February 2001; however, because of the amount of documentation
to review and the multiple ABC, Inc. offices in locations for major ABC
contract work, the audit will not be complete until November 2001 (fiscal
year 2002).
B. Multi-Year Appropriations - These appropriations are available for obligation over a
definitive period in excess of one fiscal year. The appropriation legislation passed by Congress
actually provides a date for funds expiration, just as do the annual appropriations. EPA's
multi-year appropriations are two-year appropriations, but each year Congress passes legislation
appropriating funds which are valid for two years, beginning with the start of the fiscal year of
October 1 and are available for obligation for two years. Because of the extended period of
availability, multi-year appropriations may have unobligated balances which "carry over" from
one year to the next and are available for obligation following reapportionment by OMB.
C. No-Year Appropriations - No-year appropriations are available for obligation without
fiscal year limitation. They remain available until expended, rescinded or otherwise withdrawn.
In order for an appropriation to be no-year, it must be expressly stated as such in the
appropriating language.
18. The Anti-deficiency Act
A. The "Anti-deficiency Act" is one of the major laws where Congress exercises its
constitutional control of the public funds. It's considered the cornerstone of Congressional
efforts to bind the Executive branch of the Government and place limits on expenditures of the
appropriation.
B. The Anti-Deficiency Act requires that people with contracting authority first ascertain
that adequate Government funds are available to reimburse a Contractor or grantee for any
obligation incurred. Second, it mandates that the Government funds requested by an Agency and
appropriated by Congress meet the test of being for a bona-fide (real) need.
C. Briefly, in its current form, the Anti-deficiency Act prohibits:
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1. obligation or expenditure in excess of appropriations;
2. obligation or expenditure in advance of appropriations unless authorized by law;
3. accepting voluntary services for the United States exceeding that authorized by law;
and,
4. obligations or expenditure in excess of apportionments or administrative divisions of
apportionments.
D. Violations of the Anti-deficiency Act involve both civil and criminal penalties. A CO
must never sign any contractually binding document without first making sure the funds are
available.
19. Government Performance and Results Act (GPRA) 1993
Since 1993, the Agency has tied its budget request, and the appropriations it receives
from Congress, to the GPRA strategic plan. The GPRA requires the Agency to develop a
strategic plan for its program activities and tie the budget requests to the plan. The plan must
have:
1. a comprehensive mission statement covering the major functions and operations of the
agency;
2. general goals and objectives, including outcome-related goals and objectives, for the
major functions and operations of the agency;
3. a description of how the goals and objectives are to be achieved, including a
description of the operational processes, skills and technology, and the human, capital,
information, and other resources required to meet those goals and objectives;
4. a description of how the performance goals included in the plan shall be related to the
general goals and objectives in the strategic plan;
5. an identification of those key factors external to the agency and beyond its control that
could significantly affect the achievement of the general goals and objectives; and,
6. a description of the program evaluations used in establishing or revising general goals
and objectives, with a schedule for future program evaluations.
The funding that is made available to the COR for her/his WA, contract, TO or DO is tied
to the GPRA operating plan goals for their office. The important point for CORs is that they
must pay for the work with the funds set-aside for it. The old accounting procedure of FIFO -
first in, first out - is no longer applicable when dealing with contract funding. (Invoices and
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payments will be covered in Chapter 6 on Financial Monitoring.) For more detailed explanation
about accounting for resources and the GPRA structure as it relates to the funds process, go to
http://www.intranet.epa.gov/ocfo/about/gpra.htm
Under GPRA, EPA has 5 goals. They are:
1. Clean Air and Global Climate Change
2. Clean and Safe Water
3. Land Preservation and Restoration
4. Healthy Communities and Ecosystems
5. Compliance and Environmental Stewardship
Contract Types
20. Micro-purchases. Micro-purchases are item(s) that have a total value of $2,500 or less.
The Government-wide commercial "purchase card" is similar in appearance to a commercial
credit card, issued to authorized agency personnel to acquire and pay for supplies and services.
OAM requires everyone who intends to obtain a purchase card to attend a one-day Purchase Card
class and pass a exam before they can apply for a purchase card. Once an individual has
completed the mandatory training, she/he can receive a delegation of procurement authority up to
the maximum dollar limit of $2,500 per purchase. This dollar limit may be lower depending on
individual program office policies within the Agency. Any Agency employee with a
demonstrated need can obtain a purchase card. The concept is to empower the individual
employee to get what he/she needs whenever she/he needs it with little paperwork burden.
Purchase card holders need only one source, but they are required to use mandatory sources such
as National Industries for the Blind and National Institute for the Severely Handicapped. Card
holders must still be sure they are getting the "best value" and should rotate their purchases from
non-mandatory sources.
21. Simplified Acquisitions. A simplified acquisition process (SAP) is defined as having a
dollar value in excess of the micropurchase dollar threshold of $2,500 but not more than
established Simplified Acquisition Threshold (SAT). The SAT for commercial off-the-shelf
items has a higher limit of $5,000,000. Use of the SAP streamlines the acquisition process and
requires only a minimum of 3 sources which can be solicited orally and maximizes the use of
electronic commerce where possible. Actions can be completed far more quickly than formal
solicitation procedures because the CO can establish deadlines for responses that give potential
offerors a reasonable amount of time rather than a regulatory number of days. Once the SAT
dollar threshold ($100,000 and $5,000,000 respectively) has been crossed, there are FAR and
legal mandates for the number of days that a Government requirement is advertised/solicited,
(i.e.: 30 days for most acquisitions and 45 days for research and development), when acquiring
supplies and services. Only designated personnel within OAM, or specially designated
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individuals outside of OAM with delegated procurement authority, can use the simplified
acquisition process. By regulation, all acquisitions at the micro-purchase and simplified
acquisition thresholds must be fixed price. The acquisition of commercial supplies and services
must also be fixed price.
22. Agency contracts. For more sophisticated requirements, such as operations support services
or large scale emergency response services a contract would be the most appropriate instrument.
The process planning and awarding an Agency contract will be covered later. Contracts are
generally defined by their pricing arrangements. There are three main categories:
- Firm Fixed Price
- Fixed Rate
- Cost Reimbursement
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a. A firm fixed price contract provides for a price that is not subject to any adjustment
on the basis of the Contractor's cost experience in performing the contract. This contract type
places upon the Contractor maximum risk and full responsibility for all costs and resulting profit
or loss. It provides maximum incentive for the Contractor to control costs and perform
effectively and imposes a minimum administrative burden upon the contracting parties.
Therefore, it is the preferred contract type. This type of contract requires a well-defined
statement of work (SOW) where the contractor can perform the work required without direction i L
from Government personnel. yi OUtM | fVH ufV
b. Cost Reimbursement (CR) J } evt( ^
(1) Cost-reimbursement types of contracts provide for payment of allowable
incurred costs, to the extent prescribed in the contract. These contracts establish an estimate of
total cost for the purpose of obligating funds and establishing a ceiling that the contractor may
not exceed (except at its own risk) without the approval of the contracting officer. Under CR
contracts, the CO orders work by issuing work assignments. Since CR contracts are funded at
contract level, funds are "drawn down" from the basic contract to pay for work performed under
the work assignment-work assignments are not individually funded. The commonly used CR
contracts at EPA are: Cost-Plus-Fixed-Fee (CPFF) and Cost-Plus-A ward-Fee (CPAF)
(2) With a CPFF contract, not only are the costs incurred reimbursed, but also the
contractor is paid a fee that is part of a negotiation between the Government and the contractor.
That fee is converted into a fixed dollar amount when the contract is awarded. The fee doesn't
vary with costs, but could be adjusted if the Government makes changes to the statement of
work.
(3) A cost-plus-award-fee contract provides for 1) an estimated cost; 2) a base fee
(which may be zero),. 3) an award fee (alsoYreferred to as the award fee pool), 4) a maximum fee,
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5) an earned fee, which is determined by the Government on a periodic basis, and 6) an award fee
plan, which specifies the evaluation criteria which will be used to evaluate the contractor's
performance.
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(4) The award fee evaluation and determination process often raises key issues to
senior levels, both in the EPA and in the contractor's organization. This results in greater
management attention to critical performance issues, to improved communications, and to
problem solving between EPA and the contractor. However, the award fee contract has certain
drawbacks, including performance evaluation procedures that can be expensive and time-
consuming. The CPAF contract inherently calls for a significant amount of monitoring and
documentation. The demands that the CPAF contract places on personnel must be
recognized, including the resources and willingness of program personnel to support the effort.
c. Fixed Rate contracts, also called "labor hour" or "time and materials (T&M),"
provides for acquiring supplies or services on the basis of: (1) Direct labor hours at specified
». fixed hourly rates that include wages, overhead, general and administrative expenses, and profit;
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the procedures for providing a "fair opportunity," COs exercise broad discretion and sound
business judgement and may consider factors such as past performance, quality of deliverables,
cost control, price, cost or other factors that are relevant to the order. When technical evaluations
are conducted, the evaluations must be documented using a streamlined, simplified standard
format allowing space for strengths, weaknesses/deficiencies, rating, and score, if appropriate.
The specific selection method for each order will be set forth in the request for offers, and will be
within the discretion of the CO with recommendation from the PO. The PO, in conjunction with
the CO, will recommend the number of participants in the technical review based on the
complexity and/or size of the task or delivery order SOW. Contractors should be reimbursed for
offer preparation costs in accordance with its established cost accounting practices. Chapter 16 of
the Contracts Management Manual contains Agency policy on the use of multiple award
contracts.
Government-Wide Acquisition Contracts and Other Alternative Contractual Vehicles
24. Consolidated Lists of Alternative Contractual Vehicles
Interest in interagency contracts has grown considerably. OAM's "GWACs and Other
Alternative Contractual Vehicles" lists a variety of contracts and discusses procedures for
using them. This guide is available at http://intranet.epa.gov/oammtra/policv/index.htm.
25. GSA Schedule Contracts
a. GSA awards and manages the Federal Supply Schedules Program. Under this
program GSA enters Government-wide contracts with commercial firms to provide commercial
products and services, at stated ceiling prices, for given periods of time. Your EPA CO places
orders directly with the Schedule Contractor, and deliveries are made directly to the customer.
b. Orders are firm-fixed price, unless the CO makes a determination that it is not possible
to accurately estimate the extent or duration of the work or to anticipate cost with any reasonable
degree of confidence. When such a determination is made, a labor hour (fixed rate) or time-and-
materials proposal may be requested. A ceiling price must be established for labor-hour and
time-and-materials orders.
c. Because GSA has already established the basic contract, procedures for ordering under
the schedule are streamlined. For example:
(1) No synopsis is required.
(2) No need to seek competition outside of the schedule.
(2) COs may use their Purchase Card to place orders.
(3) There is no monetary order limitation.
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(4) Orders can include option periods.
(5) Technical evaluation methods are simplified.
d. These streamlined procedures significantly reduces acquisition lead time for issuing a
schedule order versus awarding an Agency contract. Depending on the dollar value and
complexity of your requirement, the CO may be able to issue Schedule order within 15 days.
Awarding an Agency contract would take much longer.
26. What are the Procedures for Placing an Order Under a GSA Schedule?
a. Procedures for ordering from GSA Schedule Contracts are described in
(1) Acquisition Handbook, Unit 38
(2) Guidelines for GWACS and Other Alternative Contractual Vehicles, and
(3) GSA's Multiple Award Schedule Owner's Manual
The same Agency CO who provides contract support to your program office will also place
Schedule orders for you. The CO will work with the end user to ensure effective management
oversight of the schedule orders by including appropriate management control clauses in task
orders to require the contractor to take certain actions, e.g., safeguarding confidential information
or sensitive data, disclosing potential conflicts of interest, etc.
b. In a nutshell, orders are placed as follows:
Ordering Procedures for COs
LESS THAN $2,500
Select a contractor and place the order. (Can be done with the Government Purchase Card.)
OVER $2,500
Send a Request for Quotes (RFQ) to 3 contractors; evaluate and make a best value selection;
place the order. (For supplies, the CO reviews 3 schedule contractors' price lists.)
OVER the MAXIMUM ORDER THRESHOLD 1
Select more than 3 contractors; evaluate and make a best value selection; seek price reductions
off of the schedule price; place the order. (For supplies, the CO reviews more than 3 schedule
contractors' price lists.)
1 Each schedule has a maximum order threshold (generally $1 million). This is not a
ceiling, but a point at which the CO is required to seek price reductions. However, voluntary
reductions can and should be sought for orders below the threshold.
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c. Procurement Initiation For orders over $2,500, the requiring office must prepare a
procurement package with the following minimum elements. Generally, the more complex the
requirement is, the more detailed the package would be.
(1) Statement of work (SOW) for services broken down by major tasks and
subtasks, including a list of deliverables, and a deliverable schedule, or detailed description for
supplies. Performance based SOWs are preferred. (See Chapter 11 of the Contracts
Management Manual for guidance on formatting and writing SOWs, including performance
based SOWs.)
(2) An independent Government estimate broken out by tasks, labor categories,
and associated rates, number of hours, and well defined other direct costs, e.g., travel, etc., for
the base year and any options. (The CO will use this later as a basis for evaluating an offeror's
proposed cost and labor mix.) A guide on developing independent government estimates is
available at http://intranet.epa.gov/oamintra/policv/index.htm.
(3) If the procurement will be best value, include evaluation factors, e.g.,
technical approach, key personnel, past performance and their relative importance.
(4) Any special requirements (i.e., security clearances, travel, etc.)
d. Based on the market research performed, the CO sends a request for quotes (RFQ) to
three or more schedule contractors that appear to offer the best value (considering the scope of
services offered, hourly rates and other factors such as Schedule contractors' locations, as
appropriate).
e. The RFQ may request the Schedule contractors submit both a cost and technical
proposal. If technical proposals will be evaluated, the RFQ must include the basis for
determining whether the Schedule contractors are technically qualified, how they will be rated,
e.g., whether technical merit is more important than cost or price, and the relative importance of
the various evaluation factors.
f. After responses have been evaluated against the factors identified in the RFQ, the CO
reviews the requiring office's technical evaluation, documents the file, and places the order with
the schedule contractor that represents the best value considering the technical factors and price.
27. Government-wide Acquisition Contracts (GWACs)
a. GWACs are indefinite delivery/indefinite quantity (ID/IQ) contracts for various
information technology (IT) resources negotiated, awarded and administered by one particular
agency but available to other Federal agencies for purchases. The Director of the Office of
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Management and Budget (OMB) has the authority to designate one or more heads of Executive
agencies as executive agents for Government-wide acquisitions of information technology.
Currently, five agencies have this designation:
(1) the General Services Administration;
(2) the National Institutes of Health;
(3) the Department of Transportation;
(4) the Department of Commerce; and
(5) the National Aeronautics and Space Administration. i I ¦ «
(6) the Environmental Protection Agency f\^(\\
b. It should be noted that in most cases there is an administrative fee for using the
contract. Fees are usually around 1%. Fees vary, so shop around. In some cases, EPA COs can
be delegatedprbcurement authority to place task orders, to ensure appropriate management
controls are in place, and to negotiate prices. This may result in a lower administrative fee.
c. The most commonly utilized GWACs within EPA are those with the National
Institutes of Health.flSflH") and the National Aeronautics and Space Administration ^(NASA).
EPA COs have been delegated procurement authority to order under these contracts/~However,
some GWACs do not allow Agency COs to place orders. Additionally, some GWACs may
require an Interagency Agreement (IAG) with the agency which awarded the contract before we
can use it. The IAG will establish whether the GWAC agency will issue the order(s) or if an
EPA CO can do it. It will also provide a funding mechanism. EPA's Office of Grants and
Debarment (OGD) will place the IAG, if required. For information on placing an IAG and a list
of IAG specialists, see the OGD Intranet site at http://intranet.epa.gov/oiniihhk/ogd.htm
** In October, the Agency made $98 million dollar award as a task order under an NIH
GWAC. The order was to establish a common, automated, and integrated approach to managing
the Government's rulemaking functions.
d. Ordering procedures and administrative fees vary under GWACs. Generally, the end
user will prepare a statement of work, funding documentation, independent government cost
estimate, and evaluation factors. The award will be made based on best value with tradeoffs
between technical and price factors, or to the lowest priced, technically acceptable contractor.
The OAM point of contact on GWACs is Tom Caffrey, (202) 564-4498.
28. Multi-Agency Contracts (MACs)
a. A MAC is a task or delivery order contract established by one agency for use by other
Government agencies to obtain supplies and services, consistent with the Economy Act. In order
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to use a MAC, it's important to fully understand the procedures for placing orders under the
contract. Typically, you will need an IAG with the agency whose contract you're using. The
IAG will fund the MAC agency's administrative fees or other costs and establish terms for using
the contract. Your local grants specialist can help you with questions concerning placing an
IAG.
b. If you use a MAC without following the proper procedures, such as placing an IAG
first, the contractor's invoice will be rejected by EPA's paying office and work performed by a
contractor will constitute an unauthorized commitment.
c. In some cases, orders under MACs can be placed by EPA COs. In other cases, the
MAC may specify that only the MAC CO can place orders. The CO who placed the order will
usually be the one who helps with questions latM j ., '
29. MACs and the Economy Act I
a. Sometimes, FAR requires the program office to prepare a Determination and Finding
(D&F) under the Economy Act before entering an IAG with another agency to use their contract.
Whether you must complete a D&F is dependent on the cooperation authorities applicable your
program office. Contact your grants specialist for more information. If required, the D&F must
justify that:
(1) The use of an interagency acquisition is in the best interest of the
Government.
(2) The supplies or services cannot be obtained as conveniently or
economically by contracting directly with a private source.
(3) The acquisition will appropriately be made under an existing contract of
the
servicing agency, entered into before placement of the order, to meet the
requirements of the servicing agency for the same or similar supplies or
services.
(4) The servicing agency has capabilities or expertise to enter into a contract
for such supplies or services which is not available within the requesting
agency; or
(5) The servicing agency is specifically authorized by law or regulation to
purchase such supplies or services on behalf of other agencies.
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The Economy Act D&F must be approved by the Deputy Director of OAM before the IAG can
be placed.
30. Discuss Your Interest in an Alternative Contractual Vehicle with Your EPA CO
a. If you've identified your requirement and are considering an alternative contractual
vehicle to meet your needs, discuss your interest with your EPA CO. Your CO can help you:
(1) Research sources, including Agency contracts which may be available.
(2) Prepare the procurement request and ensure that you plan enough time to
develop a good procurement package from which to request competitive quotes and get the best
value for the Agency.
(3) Review the terms and condition of alternative contractual vehicles to ensure
appropriate clauses and management controls are included in orders.
31. Problem Areas
a. Since alternative contract vehicles are a somewhat unchartered area, some issues
concerning their use are cropping up. This section covers many of the issues uncovered in an
FY 2003 Office of Inspector General audit on GSA Schedule orders. (The entire report is
available at http://www.epa.gov/oig/reports/contracts.htm.)
(1) Inadequate or no market research. Before deciding whether to use GSA
Schedule, a GWAC, or MAC, take an extensive look at what's out there, including
administrative fees (amount and how applied), ordering procedures, variety of services offered,
availability of skilled personnel, contract costs, and terms. Check as many contractors' price lists
as practicable-don't limit your search to just a couple of contractors. Document your market
research.
(2) Poor procurement initiation packages. In their audit of GSA orders, the
OIG found SOWs were not performance based, independent cost estimates were inadequate, and
criteria for evaluating the offerors' proposals was missing. Chapter 7 of the Contracts
Management Manual covers what's needed in a procurement initiation request. If you need help
in these areas, take a look at OAM's Intranet site or ask your PO or CO for help.
(3) Lack of competition. Federal and Agency regulations require that we
compete all acquisitions unless there this a valid justification to restrict competition. Besides
inadequate market research, there were several factors contributing to the lack of competition:
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- Inadequate program office planning and rushed procurement.
- Limited time for contractors to submit proposals.
- Poor sole source justifications.
(a) Inadequate program office planning and rushed procurement. The
program office must plan enough time to conduct effective market research and to draft a good
procurement initiation package. The CO needs enough time to review the package to ensure all
needed documentation (SOW, IGCE, and evaluation criteria) are adequate before issuing the
RFQ. Talk to your CO while planning an acquisition to avoid rushed procurements.
(b) Limited time for contractors to submit proposals. The Pentagon's
Acquisition Chief stated, "too often you see RFQs released on a Friday with the bids due on
Monday.... It is well known in industry that when there is a shorter time frame, it often means
that the customer knows who they want to award the contract to." There is a correlation between
the number of days provided to respond to an RFQ and the number of quotes received. The
greater the number of days provided to respond, the more offers received. More offers mean
better selection and prices. A shorter turnaround time tends to favor incumbents and
disadvantages small businesses and non incumbents who are not familiar with the requirements
and must prepare detailed cost and technical proposals from scratch.
Best Practice (from the OIG audit)
Region 7 awarded an order for IT/telephone and help desk services. Based on extensive market
research, the Region sent RFQs to five contractors, and held a pre-bid conference to discuss
the performance-based SOW. As a result, four of the five contractors submitted quotes. Most
of these contractors voluntarily provided price quotes below the GSA-approved rates. The
quotes were evaluated against the detailed IGCE, and the lowest quote was selected. The
award saved EPA more than $1 million.
(c) Poor sole source justifications. FAR mandates a written justification if a
requirement is not competed. The sole source justification must fully explain the circumstances
and include relevant information. At a minimum, the justification must contain a description of
the contractor's unique qualifications, efforts made to ensure that offers are solicited from as
many potential sources as practicable (market research), actions taken to remove or overcome
any barriers to competition before any subsequent acquisitions. For urgent requirements the
justification must address how delay in award of a contract would result in serious injury to the
Government. The FAR also states that lack of advance planning by the requiring activity or
concerns related to the amount of funds available (for example, funds will expire) is not an
appropriate reason to limit competition.
(d) Not following the ordering procedures. Whether you are using GSA
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Schedule, a GWAC, or a MAC, it is important that you understand the procedures for placing
orders. If you want to use one of these vehicles and have questions about how to access them,
ask your CO. For GSA schedule, the OIG audit pointed out several significant problems:
• SOWs were not always performance based.
• RFQs lacked required evaluation factors.
• IGCEs lacked necessary information.
• Quotes were inadequately evaluated.
• Best value and price reasonableness analysis were missing or inadequate.
• Price reductions from schedule contractors were not sought.
The RFQ must describe the basis for selecting the contractor (low cost, past performance,
technical merit). Evaluate offers in accordance with the criteria and methodology stated in the
RFQ. Allow plenty of time for a thorough evaluation of the adequacy and technical soundness of
proposals. Document your evaluation detailing strengths and weaknesses of technical proposals
as well as differences between cost proposals and the IGCEs.
(6) Some GWACs and MACs charge a processing or use fee. Check the ordering
procedures to see the amount and when these charges apply. Fee structures for similar contracts
can vary between agencies. If the fees are high, it may be worthwhile to use an EPA contract.
32. Special Requirements When Acquiring Advisory and Assistance Services
When acquiring advisory and assistance services (AAS), the CO MUST make multiple
awards whenever the requirement, including all optional periods of performance or quantities,
exceeds three years and $10,000,000, unless the CO makes a written determination that (1) only
one source can provide the services at the required quality level, (2) only one source can
reasonably perform the work because the the SOW is unique or highly specialized or the tasks
are integrally related, (3) only one offer is received although multiple sources were sought.
FAR Subpart 37.201 defines AAS as: "Services provided under contract by non-
governmental sources to support or improve: organizational policy development; decision-
making; management and administration; program and/or project management and
administration; or research and development activities. It can also mean the furnishing of
professional advice or assistance rendered to improve the effectiveness of Federal management
processes or procedures (including those of an engineering and technical nature)."
33. Periods of Performance
There is a statutory limit on the length of time for which a contract can be written. No
Federal contract period of performance can be for more than 60 months or 5 years unless special
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Congressional approval is given. Some of EPA's statutory authority allows for contracts in
excess of 60 months or 5 years. In order to avoid obligating the Government for more than is
necessary or more than anticipated, most of EPA's large contracts are awarded for a base period
of 12 months/1 year with optional periods of performance of 12 months up to the 60 month/5
year limit with the expectation that all options will be exercised. Costs or prices proposed and
negotiated with a Contractor cover the expected 5 years of performance.
34. Options
There are 2 types of options:
1. Time (as in optional periods of performance) and,
2. Quantity (as in Optional quantities within each POP).
The FAR prohibits COs from using options if it will cause the Contractor to incur undue
risks, the option represents known firm requirements for which funds are available, or market
prices for the supplies or services involved are likely to change substantially.
(1) An option in Government contracts represents a unilateral right, for a specified period
of time, to extend the period of performance of the contract or of the Government to purchase
additional supplies or services within a POP. This means that the Government can increase
quantities or POPs at its discretion without further agreement or input from the Contractor as
long as the Government originally competed the requirement for the total potential POP and
optional quantities, and the Contractor agreed to perform for those amounts or time periods as
part of their original offer or bid. Only if the option(s) were evaluated as part of the initial
competition is the requirement for full and open competition satisfied.
Options are used when it's in the Government's best interests. For services, which are
the bulk of EPA contracts, options or optional quantities are appropriate to ensure the continuity
of operations and to avoid frequent costly competitions every year. All contracts with options
must state a period of time during which the option or optional quantities can be exercised by the
Government unilaterally. Once that stated period of time has elapsed, the only way to exercise
the option is by obtaining the Contractor's concurrence. Unless otherwise stated in the contract,
for additional contract POPs, COs must notify Contractors no less than 60 calendar days prior to
the date of the start of the next option period. The requiring activity must advise the CO that 1)
funds are anticipated to be available to fund the additional POP, and 2) there is a continuing need
for the supplies or services.
(2) For optional quantities within a POP, the contract states a limit on the number and
frequency of these additional orders in order to avoid placing a burden on the Contractor in
excess of its capacity to respond. Before an optional period of performance can be exercised, the
CO is required to do a market research survey and determine that the prices/costs represent the
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most advantageous method of fulfilling the Agency's requirement. This determination can be an
informal analysis of prices/costs or examination of the market that indicates the option
A modification is an adjustment to the terms and conditions of a contract, DO, or TO and
must be within scope (with the statement of work and the dollar amount).
The authority to modify a contract/TO/DO must be one of the situations authorized by
law or regulation. Modifications follow a specific process and require consideration.
Consideration means that the Government receives adequate value in exchange for its
agreement to modify the contract/TO/DO, no matter what the basis is for the modification. In
some instances, the adequate value will represent a tradeoff of factors resulting in no increase or
decrease in the price or estimated cost (i.e.: Contractors agreeing to an extension on a period of
performance at no additional costs to the Government when they would be ordinarily entitled to
compensation.) In other circumstances, the adequate value could be the additional supplies or
services priced out at the time of contract award (i.e.: optional quantities or options periods of
performance) for which the Contractor is compensated at the values negotiated or bid at the time
of contract award.
Modifications can be either unilateral or bilateral. A unilateral modification is when the
CO takes an action, within the agreed to terms and conditions of the original contract award, that
changes the contract. The CO is able to take the action without first obtaining the
agreement/concurrence of the Contractor.
A bilateral modification is one that requires the signatures of both the Contractor's
designated, authorized official and the CO. It is also referred to as a supplemental agreement and
usually involves situations where the Government has made a change and incurred additional
obligations.
The process for modification starts with a written request justifying or rationalizing the
need from either the requiring activity or the Contractor. The CO receives this request and
reviews it. If the Contractor has made the request, the COR should evaluate the request as well.
Each party requesting the modification is responsible for providing all documentation to support
the request. At a minimum the request should:
1. Be clear and understandable as to what the change asked for includes.
2. Be a change that is not covered by the current contract/TO/DO.
3. Be acceptable to all appropriate Agency officials.
4. Include all appropriate and adequate information to support the request.
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5. Detail the impacts the proposed changes will make upon the quantity, quality, price or
cost, and completion date.
All modifications will have an impact. CORs will be asked to provide a technical
evaluation of a proposed change when a Contractor's request would result in a change to the
basic contract requirements not anticipated prior to contract award. The evaluation need to
address how the change will impact delivery and performance. In order to evaluate the price/cost
impact, CORs can use a history of similar acquisitions, market surveys of current conditions, or a
price/cost realism analysis.
An amendment is a written change (including cancellation) to a solicitation, Request for
Quotation (RFQ) or WA. These documents are amended since none of them are binding
contractual agreements as are contracts, DOs or Tos. If time is of the essence, the CO can make
an oral amendment, followed up by a formal written amendment. Electronic equivalents can also
be used. An amendment is appropriate when there is a change to the Government's requirements
or its terms and conditions, the CO can amend or cancel the solicitation or WA. If a proposal
from a Contractor is of interest to the Government that is also a departure from the Government's
requirements, the CO must amend the solicitation. When the Government is unilaterally
amending a WA, the Contractor must submit a revision to its technical or cost proposal for that
changed portion of the WA. When the Government is amending a WA in response to a
Contractor's departure from the Government requirements, the Contractor's original technical
and/or cost proposal is accepted without further submittals.
COR Roles and Responsibilities
36. The Contracting Officer (CO)
a. Ultimately, the CO is responsible for the administration of his or her contract. COs
have the authority to enter into, administer, or terminate contracts and to make related
determinations and findings on behalf of the Agency. The Federal Acquisition Regulation
(FAR) specifies the CO is responsible for "ensuring performance of all necessary actions for
effective contracting, ensuring compliance with the terms of the contract, and safeguarding the
interest of the United States in its contractual relationships." Furthermore, the FAR states, "the
Contracting Officer must have the authority to the maximum extent practicable and consistent
with law, to determine the application of rules, regulations, and policies, on a specific contract."
In undertaking this effort, many COs rely on the contribution of numerous financial, legal, and
technical experts to assist them.
b. The definition of the CO contained in FAR 2.101 includes certain authorized
representatives of the CO acting within their authority. Due to the size and complexity of
Agency acquisitions, COs frequently appoint qualified individuals to perform certain contract
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administration activities. The Governmentwide term for these individuals is a "Contracting
Officer's Representative," abbreviated as "COR."
37. The COR (in General)
a. A COR is the authorized representative of a contracting officer. A COR may be either
an EPA employee or another Federal agency employee, nominated by the program office and
appointed by the CO, who possesses the necessary knowledge, skills, and abilities to perform the
COR duties.
b. Over the years, EPA has developed a wide range of Agency-unique titles for
employees who perform COR duties, such as project officer, work assignment manager, delivery
order project officer, task order project officer, task monitor, and so forth. Regardless of the title
or their varying roles, all these individuals are CORs. The basic differences, which will be
discussed later in this chapter, center on the acquisition instrument the COR manages, whether it
is a basic contract, a work assignment, task order or delivery order.
c. COR duties are inherently governmental functions. For this reason, CORs must be
qualified Federal Government employees. Senior Environmental Enrollees (SEE) cannot
function as CORs.
d. CO appointment of a COR does not grant authority to enter into contractual
agreements or amendments. CORs may perform only those functions delegated to them, and
must not take any action reserved for the CO, such as:
(1) Promise or authorize the contractor to perform work that is additional to or
outside the scope of the contract, work assignment, delivery or task order, etc.;
(2) Conduct negotiations or bind the Government by making any written or oral
agreements with contractors;
(3) Directly or indirectly change the following:
- Pricing, cost or fee;
- Scope of the acquisition (contract, purchase order, work assignment,
delivery or task order, etc.);
- Delivery schedule or period of performance;
- Labor mix or level of effort; or
- Any terms or conditions of the acquisition.
(4) Redelegate or reassign their COR authority;
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(5) Authorize Government-furnished property, or its disposition; or
(6) Direct the contractor to start work or issue stop work orders.
38. Standards of Conduct as They Apply to CORs
a. All Government employees must follow the Standards of Ethical Conduct for
Employees of the Executive Branch, codified in 5 C.F.R. Part 2635 (1/1/99 Edition) as amended
at 64 FR 2421-2422 (Jan. 14,1999) and 64 FR 13063-13064 (Mar. 17,1999). A copy of this
document is available at the United States Office of Government Ethics Internet site,
http://www.usoge.gov.
b. Since their duties involve the exercise of discretion in the sensitive area of acquisition,
all CORs must file Office of Government Ethics Form 450, Confidential Financial Disclosure
Report, with their respective organization's designated ethics official. A list of Agency ethics
officials is available on the Agency Intranet at http://intranet.epa.gov/ogc/ethics.htm. In
accordance with 5 C.F.R 2638.704, employees, such as CORs, who are required to complete
Form 450 must be given ethics training each calendar year. Providing this training is the
responsibility of the COR's organization.
c. Because of past problems and the sensitivity of this area, OAM recommends that
Agency organizations emphasize standards of conduct, laws, and regulations related to conflicts
of interest, as it relates to Government-contractor relations in their ethics training. These laws
and regulations define what is considered to present a conflict (incompatibility), or an appearance
of a conflict, between Government employees' official duties and their outside financial interests
and affiliations (as well as certain financial interests of their spouse, minor or dependent children,
outside employers and other entities). Also covered in the concept of "conflict of interest" are
matters such as receipt of gifts, outside activities, impartiality, and seeking non-Federal
employment.
d. Financial conflicts are not the only situations where impartiality may be questioned.
A COR's objectivity may also be affected by a personal relationship with a contractor employee.
Because of this, CORs must recognize that establishing or maintaining a personal relationship
with a contractor employee could raise concerns about the COR's objectivity in performing their
duties. In cases where CORs have personal relationships with contractor employees, the OAM
strongly encourages CORs to seek the guidance of their Ethics Official, in determining if the
situation is or might appear to be a conflict of interest. By reviewing the situation with their
Ethics Official, any concerns can be addressed and resolved in a manner that protects both the
employees' and the Government's interests.
e. In addition to the Standards of Conduct referenced above, CORs must also comply
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with the contractual regulations applicable to relationships between Government personnel and
contractor employees found in the Federal Acquisition Regulation (FAR) 3.101 and 9.5, and the
EPA Acquisition Regulation (EPAAR) 1509.5.
(1) FAR 3.101 reiterates that Government business must be conducted in a
manner above reproach with complete impartiality and without preferential treatment.
Transactions relating to the expenditure of public funds require the highest degree of public trust
and an impeccable standard of conduct. The general rule is to avoid strictly any conflict of
interest or even the appearance of a conflict of interest in Government-contractor relationships.
(2) A relationship between a Government employee and a contractor employee
could also raise concerns under FAR 9.5, Organizational Conflicts of Interest, and applicable
EPA acquisition regulations and contract clauses, including EPAAR 1552.209-71 and
1552.209-73, which deal with organizational and contractor employee personal conflicts of
interest, respectively. Such concerns could exist, for example, if the relationship affects, or
potentially affects, the ability of the contractor to render impartial advice or assistance to the
Government, or impairs the objectivity of the contractor employee in performing the contract
work. If a COR is involved in, discovers, or otherwise learns of a situation that raises such
conflict of interest concerns, he or she must consult with the CO. It is the CO's responsibility to
review the situation and determine what action could be taken to avoid, neutralize, or mitigate
the conflict of interest or potential conflict of interest.
39. Contract-Level CORs (Project Officer)
a. Traditionally, EPA has a multi-tiered structure for CORs. The title "project officer,"
abbreviated as "PO," was used to denote the CO's primary representative on a basic contract. In
this chapter the PO becomes the contract-level COR. As the CO's primary representative, the
contract-level COR usually oversees the delivery order, task order, or work assignment CORs
described in the next section of this chapter. In some cases the contract-level COR may be
responsible for both pre-award and post-award contract functions. Attachment 2 to this chapter
lists the duties a contract-level COR may perform if delegated by the CO.
b. Assistance agreements also have POs. This role is unique from that of the contract PO
or contract-level COR. Questions concerning the training requirements and the duties of
assistance agreement POs should be referred to the Office of Grants and Debarment (OGD).
Information about OGD PO training is available on the Agency Intranet at:
http://intranet.epa.gov/oiniihhk/proiect officer training.htm.
c. For contracts which cover multiple Agency organizations or geographical locations,
the CO may appoint a contract-level COR to administer the basic contract for each location (such
as a region, laboratory, etc.) or for a combination of locations, such as a contract zone. An
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example of such an arrangement, with contract-level CORs for regions and a zone, is contained
in Office of Solid Waste and Emergency Response Directive 9972.00. Whenever this
arrangement is used, the CO must stipulate the relationship between the contract-level CORs in
the COR Appointment Memorandum.
d. Due to the complexity and high dollar value of most Agency contracts, the contract-
level COR function is extensive and complex. Contract-level CORs usually monitor the overall
contract and oversee the work of CORs who are managing work ordered under the contract. For
this reason, it is crucial that contract-level CORs be employees in good standing who have the
requisite knowledge, skills, and abilities to perform their role and assist other CORs.
(1) If a contract-level COR's function will involve only managing the overall
contract, and day-to-day contractor oversight will be performed by work assignment, delivery or
task order CORs, then the contract-level COR need not possess specialized technical expertise in
science, engineering, etc.
(2) If the basic contract does not have a separate tasking mechanism (e.g., work
assignments, delivery or task orders), or if the contract-level COR will personally manage any
orders under the contract, then the contract-level COR must possess the technical expertise in
science, engineering, etc. to perform this function.
(3) Contract-level CORs, particularly those without specialized technical
expertise, may seek the advice of their work assignment, delivery or task order CORs, or other
Government professionals when needed to resolve contract issues. However, contract-level
CORs must be mindful that COR duties are inherently governmental functions and decisions
must not be made by contractors or parties outside the Government.
e. Contract-level CORs must have six months of contract management experience in any
one of the following: (a) serving as a COR on a delivery order, task order, or work assignment,
(b) having GS-1102 experience, (c) serving as a COR at another Federal agency, or
(d) mentoring with an experienced contract-level COR.
40. Other Types of CORs
a. The CORs listed in this section are generally involved in post-award activities,
overseeing a specific portion of work ordered under a contract. In addition to Agency contracts,
they may also function under certain simplified acquisitions involving complex requirements or
orders placed under General Services Administration (GSA) Multiple Award Schedule (MAS)
contracts, Governmentwide Acquisition Contracts (GWACs), or Multi-Agency contracts
(MAC). Attachment 3 to this chapter delineates duties the CORs listed below may perform.
Usually, the delivery order, task order or work assignment COR works with the contract-level
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COR.
(1) Delivery Order COR - A COR appointed to an indefinite-delivery type
contract or other acquisition instrument where contractor supplies are ordered through separately
funded "delivery orders" awarded by the CO. This term includes CORs functioning on orders
for supplies under GSA MAS contracts, GWACs, and MACs.
(2) Simplified Acquisition COR - A COR appointed to simplified acquisitions for
either supplies or services. Typically, simplified acquisitions do not require a COR. However,
for complex requirements, the CO may determine that it is in the Government's interest to
appoint a COR. In this case the individual appointed as a COR must meet the requirements of
this chapter.
(3) Task Order COR - A COR appointed to an indefinite-delivery type contract or
other acquisition instrument where contractor tasks or services are ordered through separately
funded "task orders" awarded by the CO. This term includes CORs functioning on orders for
services under GSA MAS contracts, GWACs, and MACs.
(4) Work Assignment COR - A COR appointed to a cost-reimbursement type
contract where contractor services are ordered through "work assignments" issued by the CO.
In contrast to a task order, a work assignment is not a separately funded document.
b. CORs listed in paragraphs 25.a.(l) through (4), above, must be technically proficient
in the work the contractor is performing. Being "technically proficient" means, for example,
having sufficient knowledge and experience to review deliverables, understand the labor
categories involved in the work, and the amount of hours needed to complete the work. OAM
recommends these CORs receive on-the-job mentoring from experienced CORs before
monitoring an order on their own.
41. Alternate Contracting Officer's Representative
a. Only a CO can appoint CORs. CORs cannot redelegate or assign their acquisition
duties to another person. Also, one COR cannot sign for another COR since the COR's authority
is contract-specific. The CO can appoint an alternate COR to act in the absence of the COR,
such as when the COR is on leave or travel. The training and experience requirements for the
alternate COR are identical to those of the COR, e.g., an alternate contract-level COR must meet
all the training and experience requirements established in this Chapter for the contract-level
COR.
b. Office of the Comptroller Transmittal Number 89-13, dated February 02,1989,
allowed CORs to designate an alternate for the purpose of signing invoices. The policy also
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allowed supervisors to approve invoices in the absence of the COR. The Office of the Chief
Financial Officer will rescind this policy effective January 02, 2003. To ensure that the Agency
meets the 30-day turnaround period on invoice approval, the program office must nominate and
the CO must appoint an alternate COR for each basic contract, delivery or task order.
c. The COR's supervisor does not have the authority to "fill-in" for the COR, to perform
COR duties, to oversee, or to direct the contractor. Only a COR who is appointed by the
cognizant contract CO may perform these functions.
42. Recommended Mentoring
Mentoring. FAI and OAM courses are designed to assist the student in gaining basic
knowledge and skills in contracting fundamentals. Attending a course alone is not enough to
ensure a transfer of learning into performance results. Supervisors and other program office staff
can help by encouraging CORs to practice new skills and providing specific feedback. OAM
highly recommends that all new CORs be mentored. This mentoring process also allows
program offices to familiarize CORs with office-specific policies and procedures. As part of
their mandate, the FAI developed the COR Workbook to help CORs apply and reinforce skills
learned in class through on-the-job assignments. (The Workbook can be downloaded from the
Internet at http ://hvdra. gsa. gov/staff/v/homepages/corbook.htnO For each COR area of
responsibility (duty), FAI has listed detailed steps for accomplishing that duty. A mentor, such
as a supervisor, team leader, or more senior COR, may assign these on-the-job tasks, oversee,
evaluate, and document a new COR's performance.
43. Nomination and Appointment of CORs
a. The first step in the appointment process is for the potential COR's immediate
supervisor to recommend a candidate by submitting EPA Form 1900-65, Nomination of the
Contracting Officer's Representatives (Attachment 4 to this chapter), to the CO. When
appointing a COR, the CO shall consider the requirements of this chapter as well as the
complexity and dollar value of the acquisition. The CO will respond to the nomination in
writing by either appointing the nominee as a COR or stating why the nominee was not
appointed.
b. When nominating an employee from another Federal agency as a COR, the
nominating official shall be the EPA program office manager who will be responsible and
accountable for overseeing the nominee's performance. CORs who work for other agencies
must:
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(1) Complete the training required by the Contracts Management Manual;
(2) Have an OGE Form 450 on file with their respective agency; and
(3) Comply with EPA contract policy and procedures.
c. The supervisor need only submit one 1900-65 per COR under the contract. Once a
COR is appointed under a specific contract, there is no need to submit additional forms for each
work assignment, delivery order, or task order under that contract for that COR.
d. If the nominee is appointed, the CO shall provide written instructions regarding the
COR's.responsibilities under the contract to both the COR and his or her supervisor. For the
COR function to be successfully performed, it is imperative that the COR understands the part he
or she plays and effectively carries out his or her responsibilities. The COR appointment
memorandum is the first step in delineating what is expected of the COR. When used
effectively, the appointment memorandum can be a beneficial working document used as a basis
for monitoring COR performance and providing ongoing feedback. A sample appointment
memorandum for a work assignment COR is contained in Attachment D. Appointment
memoranda for other types of CORs will be similar in format. The CO must tailor this sample to
list any duties, responsibilities, or limitations specific to the acquisition at hand.
e. Once a COR or alternate COR is appointed, the CO should list the individual in the
applicable contract, delivery order, task order or work assignment or otherwise notify the
contractor and payment office. When appointing a work assignment, delivery order or task order
COR, the CO should notify the contract-level COR of the appointment. This notification can be
made by a courtesy copy of the appointment letter.
44. Other Key Players in the Contracting Process: Other Agency Delegations
a. Property specialists - The EPA has entered into an Inter-Agency Agreement with the
Defense Contract Management Command for the monitoring and control of any Government
property in the hands of EPA Contractors.
b. Cost Analysts/Auditors - Federal law requires a CO to obtain the best value for tax
payer dollars. The costs and prices must be determined to be fair and reasonable. To assist in
these determinations, a CO calls upon a cost analyst to help with reviewing a Contractor's cost or
pricing proposal, element by element. The analyst provides advice on labor rates, indirect rates,
Subcontractor and Consultant costs and fees assessed for items such as computer usage or
photocopier expenses. Also involved in the process is an auditor who examines the Contractor's
accounting systems for close-outs. From time to time during a Contractor's performance, if a
CO or COR feels that a Contractor is incorrectly billing a contract, the CO or COR can request
an audit of a Contractor's system. If a company is subject to cost accounting standards, FAR
Part 31, auditors perform reviews to ensure that the Contractor is adhering those standards.
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c. Legal Counsel - All terms and conditions in a contract must meet the legal
requirements and a CO calls upon the Contract Legal Counsel to advise and consent. Legal
counsel gets involved in all protests of contract awards and claims by Contractors against the
Government. Legal counsel also provides invaluable advice on a variety of issues arise in the
course of contract pre-award and post-award management.
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Appendix to Chapter 1
Document Page Number
1. Exhibit 1-1 - Competitive Procurement Process Flowchart 1-39
2. Duties Performed by Contract Level CORs 1-40
3. Duties Performed by Other Types of CORs 1 - 45
4. COR Nomination Form (EPA Form 1900-65) 1 -49
5. Sample COR Appointment Memorandum 1-50
6. Attachment 1 to COR Appointment Letter 1-51
7. Attachment 2 to COR Appointment Letter 1-56
8. Exhibit 1-2 - Roles & Responsibilities Matrix 1-58
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Exhibit 1-1
Competitive Procurement Process
Strategic
Decisions
Long Range
¦ Acquisition
Plans (Annual) -
—^1 *
TEP Members
Appointed
1
~
Planning
~
1 PO Named
I
PO Writes PIN
Package &
CO & PO Meet
to Discuss PIN
Remaining Docs
PO/CO Agree
FedBizOps
are sent (Eval
Crit, etc.)
Package is
Announcement
1
RFP is Drafted
CO
Documentation
w
Reviews are
completed
RFP is released
on the
CO Responds
Questions
>
W-
Proposals are
received
CO Meets with
TEP
TEP Evaluates Technical Proposals
(Oral Presentations/ Written
Review)
TEP Reaches
Consensus
w
Competitive Range
Established by the
Contracting Officer
CO Begins Cost
Analysis (Full-Blow
Audits/Rate Checks)
TEP Chair Writes &
Submits TEP Report (TEPR)
to the CO
CO decides whether to hold
discussions or award without
co/cs
Develops
Interrogatories
Negotiation
Position Established
CO/CS Hold
Disc unions
P
Noncompetitive
Firms Notified
Revised
Proposals.
Received from
Source Selected &
V
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Attachment 2
Duties That May be Performed by Contract-Level CORs, If Delegated by the CO
a. FAI has established the basic duties CORs perform. FAI's COR Workbook details the
duties and contains extensive documentation of the steps to be taken in performing each duty
which is not repeated here. The Workbook can be read or downloaded at
http ://hvdra. gsa. go v/staff7 v/homepages/corbook.htm
b. In this attachment, for each FAI-established duty, Agency-unique steps are listed and
applicable Agency guidance is referenced. This list is not intended to be a standard operating
procedure for contract management functions. These duties must be tailored to the specific
program and contractual needs.
1. Prepare a Requirements Package
a. Forecasting Requirements—Estimate Program Office lead time, available funding, and
total acquisition costs, as part of the planning, programming and budgeting process as required in
Chapter 1 of this manual.
b. Communicating with Industry-Follow the standards of the Office of Acquisition
Management's document, "Program Manager's Guide For Communicating With Industry," dated
September 4, 2001, which provides general guidelines regarding the types of information that
may be shared with the public, primarily in the context of procurement opportunities. This guide
is available on OAM's website at http://epawww.epa.gov/oamintra/policv/pmgci.pdf.
c. Acquisition Planning-Provide the CO backup information to be used in drafting the
written acquisition plans as required by the Federal Acquisition Regulation, Part 7, and Chapter 1
of this manual. Facilitate meeting program office small and disadvantaged business utilization
and other socio-economic goals.
d. Procurement Initiation Notice (PIN)-Following the procedures outlined in Chapter 2
of this manual, prepare key documents to initiate the acquisition. When requested by the CO,
provide applicable PIN documents for simplified acquisitions, or orders under other agencies'
contracts, e.g., GWACs or GSA schedules. Prepare an acquisition statement of work in
accordance with Chapter 21 of this manual.
e. Ordering Work under the Contract—Review procurement packages submitted for work
assignments, delivery orders, or task orders to ensure the package is current, accurate, and
complete before forwarding to the CO for action. Ensure that the procurement package identifies
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vulnerable and sensitive services, potential conflicts of interest, as well as appropriate
management controls. Track orders placed under the contract.
2. Government Property
In accordance with Chapters 2 and 5 of this manual, identify and justify the use of
Government property under the contract.
3. Technical Assistance
a. In accordance with EPAAR Part 1515 and Chapter 2 of this manual develop technical
evaluation criteria, chair the technical evaluation panel, evaluate offers, coordinate the consensus
documentation, and prepare the technical evaluation panel report justifying the panel's findings.
Draft questions for fact finding, discussions; and prenegotiation position on technical proposals.
b. Technical Evaluation of Work Plans and Delivery Order Staffing Plans—Prepare
detailed findings and recommendations on the reasonableness of the proposed tasks, labor hours
and mix, materials and quantities, etc., based on comparison with the statement of work and the
independent Government cost estimate. In accordance with Chapter 16 of this manual, conduct
evaluations of offers received under multiple award contracts.
4. COR Workplan
a. Set-up a file system containing all relevant documentation including the basic contract,
list of CORs under the contract, all correspondence and meetings related to the contract,
technical direction, contract deliverables received and reviewed, payment file and other items
that will provide an audit trail of the contract-level COR's actions under the contract. Maintain
files in accordance with Agency National Records Management Program policy. Guidance on
maintaining EPA Series 202, Contract Management Records, is available on the Intranet at
http://www.epa.gov/records/policv/schedule/sched/202.htm.
b. Protect information that is prohibited from disclosure by law, such as trade secrets and
privileged or confidential commercial or financial information, and certain interagency and
intra-agency predecisional deliberative communications. Protect information about individuals
when disclosure would constitute a clearly unwarranted invasion of personal privacy. Protect
records or information compiled for law enforcement purposes, if certain interests would be
harmed by release, including when disclosure could reasonably be expected to interfere with
enforcement proceedings or to constitute an unwarranted invasion of personal privacy.
5. Post Award Orientation
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a. Be familiar with the terms and conditions of the contract and the statement of work.
Know who the key players are (CO, CORs, contractor's Project Manager) and understand their
roles, responsibilities, and delegated authority. Know the proper method for ordering work
(work assignment, delivery order, or task order) under the contract.
b. Coach delivery/task order or work assignment CORs in appropriate administrative
processes and practices for ordering and overseeing work under the contract.
6. Administering Government Property
In accordance with Chapter 5 of this manual, properly transfer, monitor the use and
disposal of Government Property under the contract.
7. Monitoring Contractor Performance
a. In accordance with EPA Order 1900.1 A, Proper Use of Contractor Services, provide
and document technical direction to the contractor, if permitted by the contract. Guard against
inappropriate contractor services, such as personal services and inherently governmental
functions.
b. Review monthly technical and financial progress reports. Compare progress to
contractor invoice charges. Consult with the CO on any potential problems identified through
such reviews.
c. Know the standards of conduct that apply to employees of the executive branch. Treat
contractors fairly and impartially. Avoid personal conflicts of interest, and prohibited activities,
such as unauthorized commitments, directed subcontracting, and personal services.
8. Inspection and Acceptance
Track, inspect, accept or reject contract deliverables.
9. Past Performance
a. Complete contractor performance evaluations electronically by use of the National
Institutes of Health Contractor Performance System as specified in Subpart 1509 of the EPAAR.
The website for the System is https://silk.nih.gov/cps/epa/homepage.
b. For award fee contracts, accurately and promptly complete Performance Evaluation
Reports, participate on award fee panels, and apply award fee factors.
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c. In conjunction with the CO, provide documentation to the Office of Grants and
Debarment concerning performance and related problems. Report indicators of fraud and other
misconduct to the CO, the Inspector General, and the Office of Grants and Debarment.
10. Modifications
Prepare purchase requests for modifications including appropriate documentation, such as
a revised SOW and cost estimate. Document evaluation of the contractor's proposal (e.g., of the
labor hours, materials, etc., incurred or proposed for the modification).
11. Options
Determine the need for contract options when planning an acquisition. At least 120 days
prior to the required date of preliminary notice as set forth in the contract, recommend whether to
exercise an option or not. Obtain the necessary commitment of funds. In a timely manner,
provide the CO with a written recommendation indicating if the option should be exercised and
supporting this decision in accordance with FAR 17.207.
12. Delays
Notify the CO about a delay in the delivery or performance schedule under the contract
and the technical impact of this delay. Assist the CO in evaluating the contractor's response.
13. Stop Work
Identify potential conditions to stop work. If appropriate, recommend the CO issue a stop
work order. Assist in discussions with the contractor and recommend to the CO when work can
be resumed.
14. Claims
Notify the CO of potential disputes under the contract. Assist the CO in resolving
disputes and in processing formal claims
15. Remedies
Notify the CO of performance failures and provide technical assistance to the CO, as
appropriate.
16. Termination
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Identify events that may lead to contract termination. Provide sufficient information to
support pursuing the appropriate termination procedure.
17. Payment
a. As detailed in Chapter 6 of this manual, review contractor invoices and approve for
payment. If appropriate, suspend costs using EPA Form 1900-68.
b. Track funds expended against contract ceilings.
c. Maintain records on current billing/final indirect cost rates under the contract. Ensure
contractor invoices reflect the appropriate rates.
18. Closeout
As detailed in Unit 2 of the Acquisition Handbook, notify the CO when contractor
performance is completed under the contract. Assist with closeout procedures.
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Attachment 3
Duties That May Be Performed by Other Types of CORs, If Delegated By the CO
a. FAI has established the basic duties CORs perform. FAI's COR Workbook details the
duties and contains extensive documentation of the steps to perform each duty which is not
repeated here. The Workbook can be read or downloaded at
http ://hydra. gsa. gov/staff/v/homepages/corbook.htm
b. In this attachment, for each FAI-established duty, Agency-unique steps are listed and
applicable Agency guidance is referenced. The duties described below are meant to provide an
overview of the types of functions performed by the types of CORs listed in section 4 of this
chapter. This list is not intended to be a standard operating procedure for contract
management functions. These duties must be tailored to the specific program and
contractual needs.
1. Prepare a Requirements Package
Prepare a procurement request with supporting documentation ( SOW, cost estimate, etc.)
to order work under the contract. Identify vulnerable, sensitive services, potential conflicts of
interest, as well as appropriate management controls.
2. Government Property
In accordance with Chapters 2 and 5 of this manual, identify and justify the use of
Government property under the work assignment, delivery or task order.
3. Technical Assistance
Technical Evaluation of Work Plans and Task Order Staffing Plans—Prepare detailed
findings and recommendations on the reasonableness of the proposed work, labor hours and mix,
materials and quantities, etc., based on comparison with the SOW and the independent
Government cost estimate. In accordance with Chapter 16 of this manual, conduct evaluations of
offers received under multiple award contracts.
4. COR Workplan
a. Set-up a file system containing all relevant documentation including the basic contract,
internal correspondence, technical direction, contract deliverables received and reviewed,
payment file and other items that will provide an audit trail of the actions on the acquisition.
Maintain files in accordance with Agency National Records Management Program policy.
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Guidance on maintaining EPA Series 202, Contract Management Records, is available on the
Intranet at http://www.epa.gov/records/policv/schedule/sched/202.htm.
b. Protect information that is prohibited from disclosure by law, such as trade secrets and
privileged or confidential commercial or financial information, and certain interagency and
intra-agency predecisional deliberative communications. Protect information about individuals
when disclosure would constitute a clearly unwarranted invasion of personal privacy. Protect
records or information compiled for law enforcement purposes, if certain interests would be
harmed by release, including when disclosure could reasonably be expected to interfere with
enforcement proceedings or to constitute an unwarranted invasion of personal privacy.
5. Post Award Orientation
Be familiar with the terms and conditions of the contract and the SOW. Know who the
key players are (CO, CORs, contractor's Project Manager) and understand their roles,
responsibilities, and delegated authority. Know the proper method for ordering work (work
assignment, delivery order, or task order) under the contract.
6. Administering Government Property
In accordance with Chapter 5 of this manual, properly transfer, monitor the use and
disposal of Government Property under the contract.
7. Monitoring Contractor Performance
a. In accordance with EPA Order 1900.1 A, Proper Use of Contractor Services, and the
terms of the acquisition, provide and document technical direction to the contractor. Guard
against inappropriate contractor services, such as personal services and inherently Governmental
functions.
b. Progress Reports-Review monthly technical and financial progress reports. Compare
progress to contractor invoice charges. Consult with the contract-level COR on any potential
problems identified through such reviews.
c. Know the standards of conduct that apply to employees of the executive branch. Treat
contractors fairly and impartially. Avoid personal conflicts of interest, and prohibited activities,
such as unauthorized commitments, directed subcontracting, and personal services.
8. Inspection and Acceptance
Track, inspect, accept or reject contractor deliverables.
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9. Past Performance
a. Assist the contract-level COR with compiling a record of the contractor's past
performance.
b. For award fee contracts, accurately and promptly complete Performance Evaluation
Reports, participate on award fee panels, and apply award fee factors.
c. In conjunction with the CO and contract-level COR, provide documentation to the
Office of Grants and Debarment concerning performance and related problems, as appropriate.
Report indicators of fraud and other misconduct to the contract-level COR, CO, the Inspector
General, and Office of Grants and Debarment.
10. Modifications
Prepare purchase request for modifications or amendments to the work assignment,
delivery order, or task order, including appropriate documentation, such as revised SOW and
cost estimate. Document evaluation of the contractor's proposal (e.g., of the labor hours,
materials, etc., incurred or proposed for the modification).
11. Options Usually reserved for the contract-level COR.
12. Delays
Notify the contract-level COR about a delay in the delivery or performance schedule
under the contract and the technical impact of this delay. Assist the contract-level COR in
evaluating the contractor's response.
13. Stop Work
Assist the CO in administering stop work orders. If appropriate, recommend through the
contract-level COR, that CO issue a stop work order. Assist in discussions with the contractor
and recommend, through contract-level COR, to the CO when work can be resumed.
14. Claims
Notify the contract-level COR of potential disputes under the contract. Assist the CO and
contract-level COR in resolving disputes and in processing formal claims.
15. Remedies
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Notify the contract-level COR of performance failures and provide technical assistance to
the CO and contract-level COR, as appropriate.
16. Termination
Identify events that may lead to work assignment, delivery or task order termination.
Provide sufficient information to support pursuing the appropriate termination procedure.
17. Payment
a. As detailed in Chapter 6 of this manual, review contractor invoices and approve for
payment. If appropriate, recommend suspension of costs using EPA Form 1900-68.
b. Track funds expended versus funds remaining on the work assignment, delivery order,
or task order. Notify the contract-level COR if additional funds will be required.
18. Closeout
As detailed in Unit 2 of the Acquisition Handbook, notify the contract-level COR when
contractor performance is completed under the work assignment, delivery order, or task order.
Assist with closeout procedures.
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Attachment 4 - COR Nomination Form
NOMINATION OF THE CONTRACTING OFFICER'S REPRESENTATIVE (COR)
'ubmit this form to the cognizant contracting officer within the Office of Acquisition Management or Regional contracting office. The contracting
officer will respond to this nomination, in writing, to both the nominee and the nominee's immediate supervisor. For additional information on the
requirements for being a COR, see Chapter 7 of the Contracts Management Manual.
la. Name of Nominee
b. Title, Series, and Grade
c. Mailing Address:
d. E-mail address:
Organization (AAship):
Office:
Mail Code:
Street Address:
Citv. State & ZiD Code:
e. Phone Number
f. Fax Number
2. The nomination is for:
3. Training completed Date Completed
~ Contract-level COR
~ Delivery Order COR
~ Task Order COR
~ Work Assignment COR
~ Other or alternate (specify):
a. COR Mentor Course
b. COR Supplemental Course
a or b is required for all CORs
Under Contract Number
c. Recertification Course
Required every 3 years after completing either aorb
4. Briefly describe the nominee's experience in performing COR duties and technical expertise in the subject matter of the acquisition.
5. I understand that my eligibility to be a COR is dependent on adequately performing my COR duties, following ethical standards of conduct for
employees of the Executive Branch, and maintaining my training. If any of these conditions are not met, I may be removed from this contract.
I cannot redelegate my COR duties. In the event that I am unable to continue performing my COR duties, I will contact the contracting officer
immediately.
I have filed Office of Government Ethics Form 450, Confidential Financial Disclosure Report, with the cognizant Deputy Ethics Official.
Signature of Nominee
Date
6. If there is a need to remove the COR, for any reason, I will notify the contracting officer immediately.
Signature of Nominee's Immediate Supervisor Date
Phone number:
Print Name and Title:
E-mail address:
EPA Form 1900-65. (Rev.) Previous Editions Obsolete. Electronic and paper versions acceptable.
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Attachment 5 - Sample COR Appointment Memorandum
[Date]
MEMORANDUM
SUBJECT: Appointment as a Work Assignment Contracting Officer's Representative
under Contract Number
FROM: CO /s/
Contracting Officer
TO: Newly Appointed
Work Assignment Contracting Officer's Representative
I hereby appoint you as a work assignment contracting officer's representative (COR) under the
subject contract. This appointment is effective as of the date of this memorandum and shall
expire: 1) when (the) work assignment(s) is/are completed, 2) when you are relieved of your
COR responsibilities, or 3) when rescinded in writing by myself or any successor contracting
officer (CO). You may not delegate your COR responsibilities. The alternate COR, if one has
been appointed, may act ONLY if you are on leave or travel.
As a work assignment COR you are a key player in protecting the Government's interests and
carrying out the Government's obligations under the contract. To do so effectively, it is
imperative that you are familiar with the contract terms and conditions as well as your
responsibilities and limitations as a COR. You are hereby authorized and put under obligation
to carry out those responsibilities set forth in Attachment 1. You are not authorized to take any
action which is not set forth herein and are specifically directed not to take any of the prohibited
actions set forth in Attachment 2. Further clarification of these responsibilities and prohibitions
may be obtained from the CO. Any act on your part which is not within the scope of this
appointment may lead to your personal financial liability to the contractor.
The contract-level COR (project officer) is . If you have any
questions concerning your delegated authority, please do not hesitate to call him/her on 000-
000-0000 or me on 000-000-0000 or e-mail me at .
Attachments
cc: COR's immediate supervisor
Contract-level COR
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Attachment 1 to the COR Appointment Memorandum
As a Work Assignment Contracting Officer's Representative under Contract , you
are responsible for the following:
1. Maintaining Your COR Eligibility
a. Remain current on all training required for CORs in Chapter 7 of the Contracts
Management Manual. (The CMM can be found on the Agency Intranet at
http://epawww.epa.gov/oamintra/policy/cmm.pdO Specifically, you are required to complete
the Recertification Course every three years after completing either the COR Mentor Course or
the COR Supplement Course, whichever was completed later. If your training lapses, you are
no longer eligible to be a COR under this contract.
b. If your training lapses or if there is a need to relieve you of your COR
responsibilities, notify the CO immediately. Until another COR is appointed, you remain
responsible for performing your COR functions. Promptly turn over all records regarding this
contract to the successor COR.
c. Know the terms and conditions of the contract and the work assignment, including
the statement of work and the approved work plan.
d. Be informed about Agency and Federal acquisition policies and procedures. This
information is available on the Office of Acquisition Management's Intranet site at
http://intranet.epa.gov/oamintra/ . The Federal Acquisition Institute's COR Workbook
provides a generic list of COR functions and the steps involved in performing these functions.
The COR Workbook can be downloaded at
http ://hvdra. gsa. gov/staff/v/homepaees/corbook.htm . Chapter 7 of the Contracts Management
Manual (CMM) contains a list of Agency-specific COR functions.
e. Comply with the standards of conduct that apply to employees of the executive
branch. Treat contractors fairly and impartially. Avoid personal conflicts of interest, and
prohibited activities, such as unauthorized commitments, directed subcontracting, and personal
services. While you are a COR, you must file Office of Government Ethics Form 450,
Confidential Financial Disclosure Report, with your organization's Deputy Ethics Official.
2. Procurement Package
To order work under the contract, prepare a procurement request with supporting
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documentation (SOW, cost estimate, etc.). Identify vulnerable, sensitive services, potential
conflicts of interest, as well as appropriate management controls.
3. Government Property
In accordance with Chapters 2 and 5 of the Contracts Management Manual (CMM),
identify and justify the use of Government property under the work assignment. In accordance
with Chapter 5 of the CMM, properly transfer, monitor the use and disposal of Government
property under the contract. Coordinate Government property issues with the CO and property
Administrator.
4. Technical Assistance
a. Review contractor work plans for approval/disapproval. When requested, prepare
detailed findings and recommendations on reasonableness of the proposed work, labor hours
and mix, materials and quantities, etc., based on comparison with the SOW and the independent
Government cost estimate. In accordance with Chapter 16 of the CMM, conduct evaluations of
offers received under multiple award contracts.
b. Inform the CO of any potential or real conflicts of interest which may arise under the
contract. Recommend possible mitigation or avoidance strategies.
5. Record Keeping
a. Establish and maintain a separate file for documents and correspondence pertaining
to the work assignment. Place in this file correspondence to and from the contractor, work
associates, and contracting officer; comments and approval of deliverables; documentation of
verbal communication with the contractor; technical direction; voucher reviews and
disapprovals/approvals; contractor evaluations; and other documents pertaining to the contract.
Document actions, conversations, meetings, technical directions, etc., as they occur and include
these in the file. Upon completion of the contract, forward this file to the CO for inclusion in
the official work assignment file.
b. Protect information that is prohibited from disclosure by law, such as trade secrets
and privileged or confidential commercial or financial information, certain interagency and
intra-agency predecisional deliberative communications, information about individuals when
disclosure would constitute a clearly unwarranted invasion of personal privacy, and records or
information compiled for law enforcement purposes, if certain interests would be harmed by
release, including when disclosure could reasonably be expected to interfere with enforcement
proceedings or to constitute an unwarranted invasion of personal privacy.
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6. Monitoring Contractor Performance
a. In accordance with EPA Order 1900.1 A, Proper Use of Contractor Services, and the
terms of the acquisition, provide and document technical direction to the contractor. Guard
against inappropriate contractor services, such as personal services and inherently
Governmental functions.
b. Assist the contractor in interpreting technical requirements. Differences of
understanding or opinion of technical requirements between the Government and the contractor
which cannot be resolved shall be referred to the CO for resolution.
c. Monitor and oversee the contractor's technical effort and ensure that performance
strictly conforms with the terms and conditions of the contract. Promptly inform both the
contractor and the CO of any unsatisfactory performance or noncompliance with the contract or
work assignment statement of work and terms and conditions.
d. Maintain reasonable contact with the contractor so as to become aware of and gain
an understanding of any problems or potential problems regarding contract performance.
Report these to the CO.
e. Review and provide input/recommendations and concurrence to the CO regarding the
contractor's proposed use of consultants and subcontractors.
f. Perform on-site surveillance of contractor performance, as necessary, to ensure
compliance with the technical provisions of the contract.
g. Spot check to see that contractor personnel are on the job and accomplishing then-
assigned tasks.
h. Determine causative factors for any slippage in performance schedule and provide a
report of such to the CO. If the contractor is responsible for the slippage, the COR shall
recommend to the CO and subsequently monitor corrective action.
7. Inspection and Acceptance of Deliverables
a. Ensure the timeliness and acceptability of all deliverables and/or reports submitted
by the contractor.
b. Perform inspection of completed work and/or services and certify acceptance or
nonacceptance of work.
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8. Past Performance
Complete a contractor evaluation form for each work assignment at the end of each
period of performance (base or option periods), and forward it to the contract-level COR.
9. Modifications
a. Prepare purchase request for amendments to the work assignment, including
appropriate documentation, such as a revised SOW and cost estimate. Document evaluation of
the contractor's proposal (e.g., of the labor hours, materials, etc., incurred or proposed for the
modification).
b. Ensure that the work assignment is formally modified or amended before the
contractor proceeds with any changes in the work, terms, or conditions of performance.
10. Payment
a. As detailed in Chapter 6 of this manual, review contractor invoices and recommend
approval or disapproval, as appropriate, to the contract-level COR. Such review shall be
completed in a manner so as to allow timely payment under the Prompt Payment Act.
b. Track funds expended versus funds remaining on the work assignment. Ensure that
costs do not exceed available funding. Notify the contract-level COR if additional funds will
be required. Prepare funding requests.
c. Progress Reports—Review monthly technical and financial progress reports.
Compare progress to contractor invoice charges. Resolve errors or deficiencies in the reports.
Consult with the contract-level COR on any potential problems identified through such
reviews. Monitor contractor costs and promptly report, in writing, wasteful contractor practices
to the contract-level COR.
d. Review invoices and monthly progress reports to ensure that the contractor utilizes
the labor skill mix (labor categories and hours) necessary to fulfill the Government's
requirement. The contractor's labor skill mix used on the work assignment, should closely
approximate what was agreed to in the approved work plan. Excessive used of either lower or
higher skilled labor should trigger a closer review of actual usage versus the approved work
plan.
11. Closeout
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Notify the contract-level COR when contractor performance is completed under the
work assignment, delivery order, or task order. Assist with closeout procedures.
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Attachment 2 to the COR Appointment Memorandum
PROHIBITIONS
As a contracting officer's representative:
1) 'DO NOT solicit proposals for enhancements to the contract;
2) DO NOT modify the stated terms of the contract;
3) DO NOT sign supplemental agreements (i.e., contract modifications);
4) DO NOT issue instructions to the contractor to start or stop work;
5) DO NOT request that the contractor perform work outside the scope of the contract or
work assignment, or perform any work without a valid work assignment or delivery
order if work is initiated under the contract through these means;
6) DO NOT direct changes to:
- what items are included in the delivery schedule,
- time of delivery,
- place of delivery,
- method of shipment,
- packing of deliverables,
- quantity, or level-of-effort,
- scope of work, drawings, designs, specifications, or statement of work.
7) DO NOT give guidance to the contractor, either orally or in writing, which might be
interpreted as a change in the expressed scope, specifications, terms or conditions of the
contract or work assignment;
8) DO NOT make any changes that will affect the duration (period of performance) of the
contract or work assignment;
9) DO NOT make any changes that will affect the cost of the contract or work assignment;
10) DO NOT authorize the contractor to incur costs in excess of the estimated costs or other
limitation on costs or funds set forth in this contract or work assignment;
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11) DO NOT approve items of cost not specifically authorized by the contract or work
assignment;
12) DO NOT render a decision on any dispute or any question of fact under the Disputes
Clause of the contract;
13) DO NOT take any action with respect to termination of the contract, except to notify
the CO of circumstances which would appear to warrant such action;
14) DO NOT authorize delivery or disposition of Government-furnished property;
15) DO NOT discuss procurement plans or any other advance information that might
provide preferential treatment to one firm over another (The Program Manager's Guide
For Communicating With Industry," dated September 4,2001 provides general
guidelines regarding the types of info that may be shared with the public, primarily in
the context of procurement opportunities. This guide is available on OAM's website at
http://epawww.epa.gov/oamintra/policv/pmgci.pdf):
16) DO NOT make commitments or promises to any contractor relating to the award of a
contract.
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Exhibit 1-2
ROLES AND RESPONSIBILITIES MATRIX
TASK
COR
CONTRACT COR
CONTRACTING
(Project Officer)
OFFICER
1. Prepare Work
Plan work
Review/edit SOW
Review package
Package
Prepare SOW
Review cost estimate
Issue WA/
Develop cost estimate
Prepare COR designation
DO/TO
Prepare forms
form and PR (as necessary)
Obligate funds
i.e., QAQP form)
Issue contract
Obtain necessary approvals
Add accounting and other
modification (as
data (as necessary)
necessary)
Assemble WA/DO/TO
package and submit to CO
2. Establish and
Acquire documents from PO
Provide documents to
Provide documents to
Maintain
Set up files
WAM/DOPO/TOPO
contract COR
Project Files
Set up files; coordinate
Set up files; coordinate
responsibilities for record-
responsibilities for
keeping
record-keeping
3. Review
Review Proposal/Work Plan
Review Proposal/Work Plan
Formally approve
Contractor's
Recommend
Recommend
Proposal/Work Plan
Technical and
approval/disapproval to
approval/disapproval
Notify Contractor of
Cost Proposal or
contract COR
to CO
approval
Work Plan
Participate, as requested, in
Participate, as requested, in
negotiations with CO and
negotiations with CO and
Contractor
Contractor
4. Perform
Review progress reports
Review progress reports
Discuss problems with
Technical
Review deliverables;
Approve deliverables
contract COR and
Monitoring
Recommend
Provide technical direction
Contractor as necessary
approval/disapproval to
Discuss problems with
contract COR
TOPO/DOPO/WAM and
Provide technical direction
Contractor; alert CO
Conduct progress meetings
with Contractor
Identify and discuss problems
with Contractor; alert contract
COR and CO
In some contracts, the Contracting Officer has delegated authority for approving a Contractor work plan to the Project Officer. In such cases
the Project Officer will notify the Contractor of approval.
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Exhibit 1-1 (continues)
TASK
DOPO/T OPO/W AM
COR
CONTRACT COR
(Project Officer)
CONTRACTING
OFFICER
5. Perform
Financial
Monitoring
6. Initiate
Amendments
and Modifications
7. IF AWARD
FEE CONTRACT
Prepare
Performance
Event Report
(PER)
Review financial progress
reports for WA/DO/TO
Review invoices; identify
questionable items. Attempt
to resolve questioned items
with Contractor. If
TOPO/DOPO approve
invoice. If suspending costs,
complete 1900-68 if
suspending costs. Submit to
FMC-RTP.
If WAM, recommend
approval/ disapproval to
Contract COR
Identify and discuss need for
corrective actions with
Contractor and contract COR
Forecast carryover funds
Determine need for
amendment to
WA/modification to TO/DO
for any increase/decrease of
hours, tasks, deliverables, or
change to schedule
Complete Performance Event
Report evaluating Contractor
performance for individual
TO/WA
Review financial progress
reports for WA/DO/TO
and overall contract
(ceilings on hours and costs)
If CR contract w/WAs
Approve or take exception
to invoices. Attempt to
resolve questioned items
with Contractor. If
unresolved, complete 1900-
68 if suspending costs.
Indicate account numbers
and submit
to FMC-RTP.
Identify and discuss need
for corrective actions with
WAM/DOPO/TOPO and
Contractor
Submit request for
carryover funds to
CO
Evaluate need for
amendment/modification;
submit request to CO
Determine need for
modification to overall
contract (addition of funds,
change in key personnel);
submit request to CO
Compile Performance Event
Reports and prepare
summary for Performance
Evaluation Board (PEB)
Review financial
progress reports for
overall contract
Review all exceptions
to invoices; determine
final payment after
reviewing all data
Discuss need for
corrective actions as
necessary with contract
COR and second tier
CORs. Discuss any
need for corrective
action with Contractor
Transfer carryover
funds to
contract for next fiscal
year
Review amendment or
modification request;
Issue amendment or
DO/TO modification
Determine award fee
pool
Present PEB report to
Fee Determination
Official
Notify Contractor of
award fee amount
through contract
modification
1
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Exhibit 1-1 (continued)
TASK
DOPO/TOPO/WAM
CONTRACT COR
CONTRACTING
OFFICER
8. Monitor GFP
9. Close Out Work
Assignment/T ask
Order/Delivery
Order
Prepare Justification of Need
Ensure that (equipment is
being used in accordance with
terms of WA/DO/TO
Ensure return of GFP; notify
contract COR
Develop procedures for shared
equipment
Determine need to closeout
WA/TO/DO, i.e.; all tasks and
deliverables completed);
alert contract COR.
Initiate new TO/WA/DO to
conclude activities begun
under WA/TO/DO from a
prior year, as necessary
Review Justification of
Need.
Ensure that equipment is
being used in accordance
with terms of TO/DO/
WA and contract
Coordinate with
Contractor, COand
Property Management
personnel on changes to
GFP (i.e., return or
exchange of GFP)
Develop procedures for
shared
equipment
Ensure all tasks and
deliverables have been
completed
Transfer remaining funds
as
necessary
Initiate new WA/TO/DO to
conclude activities begun
under a WA/TO/DO from
a previous year, as
necessary
Issue contract
modification,
authorizing GFP
Coordinate with
Contractor, contract
COR and Property
Management personnel
in processing
changes to GFP
Process new
WA/TO/DO to
conclude activities
begun under a
WA/TO/DOfrom a
prior year, as
necessary
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1
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Chapter 2 - Special Contract Clauses
1. Introduction. This chapter will address issues related to managing your contract, work
assignment, delivery or task order. Areas to be covered include technical direction, the proper use
of contractor services,, management controls,, inherently governmental functions, and sensitive or
vulnerable services. Additionally, this chapter will cover the types of information you'll have
access to as a contracting officer's representative (COR), which information can be released and
which must be safeguarded.
If you have any questions regarding the propriety of releasing information in a
specific case, consult with a CO (contracting officer) or the Office of General
Counsel before releasing the information.
The following sections will cover these necessary controls.
2. Conflicts of Interest (COI)
a. Contracts must not be awarded to any firm that is unable or potentially unable to
render impartial advice or assistance to the Government, or that has an unfair competitive
advantage. It is important that the Agency receive an unbiased work product from the
contractor. EPA must ensure it's Contractors do not have any actual or potential conflict of
interest. The Agency must avoid situations such as the following:
(1) A contractor is working for a potentially responsible party (PRP) and is also
working for the Agency at a hazardous waste site (especially if that contractor may testify in a
cost recovery case).
(2) An automobile manufacturing firm gets an Agency contract to test auto
emissions.
(3) An Agency contractor is conducting an economic analysis of pesticides related
to rule making and that firm also manufactures pesticides.
(4) An Agency contractor is providing analytical lab services to determine the
risks to human health and the environment while that same firm is owned by a chemical
manufacturer.
(5) An Agency contractor providing technical advise in the contract source
selection board also does a significant amount of work with a software manufacturer.
b. In most Agency contracts, clauses are included to address controls for identifying and
avoiding, mitigating, or neutralizing actual or potential conflicts of interest. Contractors are
required to identify potential COI situations to the CO as soon as the issue is recognized. Even
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with these clauses in place, CORs are encouraged to report all suspected COI situations to the
CO. If a potential COI is identified, the CO will work with the COR to determine the proper
action to take. Note, it is the CO's sole authority to determine if a COI is present and how it may
be avoided, neutralized or mitigated.
The contract has the required COI clauses; which flow down and are applicable to
Subcontractors and Consultants:
v WAX 'Z? a) Organizational Conflict of Interest Notification (EPAAR 1552.209-70)
V?) Organizational Conflicts of Interest (EPAAR 1552.209-71)
^ c) Notification of Conflicts of Interest Regarding Personnel (EPAAR 1552.209-73)
d) Limitation of Future Contracting (EPAAR 1552.209-74)
e) Annual Certification (EPAAR 1552.209-75)
3. Inherently Governmental Functions
tontadG oflV'n.JGP
a. Agency and Federal acquisition regulations prohibit contractors from performing
inherently governmental functions (IGF). The FAR defines "inherently governmental function,"
as a function that is so intimately related to the public interest as to mandate performance by
Government employees. This definition is a policy determination, not a legal determination. An
IGF includes activities that require either the exercise of discretion in applying Government
authority, or the making of value judgments in making decisions for the Government.
Governmental functions normally fall into two categories: the act of governing, i.e., the
discretionary exercise of Government authority, and monetary transactions and entitlements.
b. An inherently governmental function involves, among other things, the interpretation
and execution of the laws of the United States so as to-
(1) Bind the United States to take or not to take some action by contract,
policy, regulation, authorization, order, or otherwise;
(2) Determine, protect, and advance United States economic, political,
territorial, property, or other interests by military or diplomatic action, civil or criminal judicial
proceedings, contract management, or otherwise;
(3) Significantly affect the life, liberty, or property of private persons;
(4) Commission, appoint, direct, or control officers or employees of the United
States; or
(5) Exert ultimate control over the acquisition, use, or disposition of the
property, real or personal, tangible or intangible, of the United States, including the collection,
control, or disbursement of Federal funds.
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c. Inherently governmental functions do not normally include gathering information for
or providing advice, opinions, recommendations, or ideas to Government officials. They also do
not include functions that are primarily ministerial and internal in nature, such as building
security, mail operations, operation of cafeterias, housekeeping, facilities operations and
maintenance, warehouse operations, motor vehicle fleet management operations, or other routine
electrical or mechanical services.
d. The following list of inherently governmental functions is from FAR 7.503:
1. The direct conduct of criminal investigations.
2. The control, prosecutions and performance of adjudicatory functions other than
those relating to arbitration or other methods of alternate dispute resolution.
3. The command military forces, especially the leadership of military personnel who
are members of combat, combat support or combat service support role.
4. The conduct of foreign relations and the determination of foreign policy.
5. The determination of Agency policy, such as determining the content and
application of regulations, among other things.
6. The determination of Federal program priorities for budget requests.
7. The direction and control of Federal employees.
8. The direction and control of intelligence and counter-intelligence operations.
9. The selection or non-selection of individuals for Federal Government
employment, including interviewing or hiring of individuals.
10. The approval of position descriptions and performance standards for Federal
employees.
11. The determination of what Government property is to be disposed of and on what
terms (although an agency may give contractors authority to dispose of property at
prices within specified ranges and subject to other reasonable conditions deemed
appropriate by the agency);
12. In Federal procurement activities with respect to prime contracts—
(i)' Determining what supplies or services are to be acquired by the
Government (although an agency may give contractors authority to
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acquire supplies at prices within specified ranges and subject to other
reasonable conditions deemed appropriate by the agency),
(ii) Participating as a voting member on a Technical Evaluation Panel (TEP)
or attending TEPs,
(iii) Approving any contractual documents, to include documents defining
requirements, incentive plans, and evaluation criteria. Includes preparing
statements of work, work assignments, technical direction documents,
delivery orders, or any other work issuance document under a contract that
the contractor is performing or may perform,
(iv) Awarding contracts,
(v) Administering contracts (including ordering changes in contract
performance or contract quantities, taking action based on evaluations of
contractor performance, and accepting or rejecting contractor products or
services),
(vi) Terminating contracts,
(vii) Determining whether contractor costs are reasonable, allocable, and
allowable, including reviewing vouchers and invoices to determine
reasonableness of costs, hours, and work performed, and
(viii) Participating as a voting member on a Performance Evaluation Board
(PEB), participating in and/or attending PEBs. Includes the actual
preparation of Award Fee Plans and preparing Award Fee Letters
(including typing).
13. The approval of Agency responses to Freedom of Information Act (FOIA)
requests (other than routine responses that, because of statute, regulation, or other
Agency policy, do not require the exercise of judgement in determining whether
documents are to be released or withheld), and the approval of Agency responses
to the administrative appeals of denials of FOIA requests.
14. The conduct of administrative hearings to determine the eligibility of any person
for a security clearance, or involving actions that affect matters of personal
reputation or eligibility to participate in Government programs.
15. The approval of Federal licensing actions and inspections.
16. The determination of budget policy, guidance and strategy.
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17. The collection, control, and disbursement of fees, royalties, duties, fines, taxes
and other public funds, unless authorized by statute, such as 31 U.S.C. 952
(relating to private collection contractors) and 31 U.S.C. 3718 (relating to private
attorney collection services), but not including-
(I) Collection of fees, fines, penalties, costs or other charges from visitors or
patrons of mess halls, post or base exchange concessions, national parks,
and similar entities or activities, or from the persons, where the amount to
be collected is easily calculated or predetermined and the funds collected
can be easily controlled using standard cash management techniques; and
(ii) Routine voucher and invoice examination.
18. The control of the treasury accounts.
19. The administration of public trusts.
20. The drafting of Congressional testimony, responses to Congressional
correspondence, (includes briefing materials to congressional staffers) or Agency
responses to audit reports from the Inspector General, General Accounting Office,
or other auditing entities.
4. Deciding What Can Be Contracted.
1. "Sensitive/vulnerable functions" is a term used at EPA to denote services which may
approach being IGF because of the nature of the function, the manner in which the contractor
performs the contract, or the manner in which the Agency administers the contract. Unlike IGF,
contractors may perform sensitive/vulnerable functions provided the appropriate management
controls are in place, such as contract clauses and administrative procedures. Contracts
involving sensitive/vulnerable services require special approvals as listed in Chapter 2 of the
Contracts Management Manual. These approvals must be in place before the contractor works
on any of these functions. After the contract is awarded the COR is responsible for ensuring the
contract clauses are enforced and management controls are carried out.
2. Management Controls. CORs must maintain a clear record of their review of the
contractor's work and that final decisions were made by Agency personnel. Such records of
review could include notes from reviews of draft and final documents by Agency personnel,
minutes from progress meetings with contractors, reports from Agency peer and board reviews,
and so forth. In areas relating to policy development, possible management controls could
include having the contractor:
(a) Submit reports that contain recommendations and explain and rank policy or
action alternatives, if any;
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! Describe what procedures they used to arrive at their recommendations;
2 Summarize the substance of their deliberations;
3 Report any dissenting views;
4 List sources relied upon;
5 Ensure that the methods and considerations upon which
recommendations are based are clear; and
6 As with all deliverables, mark all contractor data, documents or reports
as contractor products.
^(b) Any situation where it can be assumed that the contractor is EPA,
without specifically identifying itself as a contractor, is another sensitive area. Control measures
must be established to ensure that contractor employees are clearly identified through the use of
badges, posted signs, e-mail "signatures," voice mail and phone answering procedures requiring
the contractor femployees to clearly identify themselves as contractors.
(c) The following list of sensitive/vulnerable functions is from FAR 7.503. This
list is not all inclusive:
1. Services that involve or relate to budget preparation, including workload
modeling, fact finding, efficiency studies, and should-cost analyses, etc.
2. Services that involve or relate to reorganization and planning activities.
3. Services that involve or relate to analyses, feasibility studies, and strategy options
to be used by Agency personnel in developing policy.
4. Services that involve or relate to the development of regulations.
5. Services that involve or relate to the evaluation of another contractor's
performance.
6. Services in support of acquisition planning.
7. Contractors providing assistance in contract management (such as where the
contractor might influence official evaluations of other contractors).
8. Contractor's technical evaluation of contract proposals. .
Wiim H n'T"
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9. Contractors providing assistance in the development of Statements of Work.
10. Contractors providing support in preparing responses to Freedom of Information
Act requests.
11. Contractors working in any situation that permits or might permit them to gain
access to confidential business information and/or any other sensitive information
(other than situations covered by the (other than situations covered by the
National Industrial Security Program described in FAR 4.402(b)).
12. Contractors providing information regarding agency policies or regulations, such
as attending conferences on behalf of an agency, conducting community relations
campaigns, or conducting agency training courses.
13. Contractors participating in any situation where it might be assumed that they are
Agency employees or representatives.
14. Contractors participating as technical advisors to a source selection board or
"participating as voting or nonvoting members of a source evaluation board.
15. Contractors serving as arbitrators or providing alternative methods of dispute
resolution.
16. Contractors constructing buildings or structures intended to be secure from
electronic eavesdropping or other penetration by foreign governments.
17. Contractors providing inspection services.
18. Contractors providing legal advice and interpretations of regulations and statutes
to Government officials.
19. Contractors providing special non-law enforcement, security activities that do not
directly involve criminal investigations, such as prisoner detention or transport
and non-military national security details.
5. Confidential Business Information
Confidential Business Information (CBI) is defined as: 1) Any information that pertains
to the interests of a business; 2) Developed or acquired by that business; 3) That was submitted
by an individual, partnership, corporation, association, or other public or private organization or
legal entity; 4) Which constitutes a "trade secret;" or; 5) Which constitutes commercial and
financial information that is privileged or confidential.
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The definition of a "trade secret," under the Freedom of Information Act, is a secret,
commercially valuable plan, formula, process, or devise that is used for the making, preparing,
compounding, or processing of trade commodities where there is a direct relationship between
the trade secret and the productive process.
Some examples of CBI include (but are not limited to): 1) Identities of chemicals;
2) Identities of pesticide inerts; 3) The fact that a company is manufacturing, importing,
processing, etc. a particular chemical; 4) Production volumes of chemicals or amount stored at a
company facility; 5) Industrial process information.
CBI contained in contract proposals and contracts includes (but is not limited to): 1) Any
financial data regarding a company, e.g., accounting methods, financial structure, assets, profits,
taxes, etc; 2) Technical proposals, plans to manage the contract, or work plans; 3) Contractor
experience, expertise, and past performance; 4) Contractor employee identities, experience and
salaries; 5) Identity of Consultants or Subcontractors; 6) Invoices and monthly progress reports,
including: a) Direct labor rates; b) Indirect rates, overhead, general and administrative, fringe
benefits; c) Other Contractor charges; d) Fee or profit.
Once a business confidentiality claim is made, EPA cannot release the information and
must protect the information from unauthorized disclosure. The Trade Secrets Act prohibits
disclosure of trade secrets or other confidential information. Unauthorized disclosure of CBI
is a criminal offence punishable by a fine, incarceration, and administrative personnel action.
6. When the Contractor Will Have Access to CBI
In some instances an Agency Contractor may need access to CBI for contract
performance. Prior to contract award, the CO and COR must decide if this will be the case. If
so, then the appropriate clauses must be inserted into the contract. During contract
administration, the COR must ensure the release of sensitive information to the Contractor is
authorized and accomplished in accordance with all relevant contract clauses and legal
requirements.
Before you.allow a Contractor to have access to CBI, the COR, whether contract level or
tasking level, must make sure that:
1." The information is being collected under an appropriate statutory authority, e.g., the
Toxic Substances Control Act.
2. The Program Office has a written determination that the Contractor's access to CBI is
necessary for contract performance.
3. The Agency has notified all entities whose CBI will be seen by another Contractor by
publishing a notice in the Federal Register, or, if it is during the pre-award phase and the Agency
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is using a Contractor to assist in the evaluation, that the name of the assisting Contractor is
clearly stated in the Request for Proposals/solicitation.
4. Appropriate safeguards are in place to track and protect CBI in the Contractor's
possession. These safeguards may include requiring the Contractor to:
a) Follow Agency CBI security procedures (e.g., the FIFRA Information Security
Manual).
b) Submit a CBI security plan to be approved by the COR.
c) Brief contract employees on Agency requirements for handling CBI.
d) Submit non-disclosure statements from Contractor employees who access CBI.
NOTE: Several Agency program offices have instituted procedures for the protection
of CBI pursuant to statutes they administer, including: 1) Clear Air Act; 2) Emergency Planning
and Community Right-to-Know Act (EPCRA); 3) Federal Insecticide, Fungicide, and
Rodenticide Act (FIFRA); 4) Resource Conservation and Recovery Act (RCRA); 5) Toxic
Substances Control Act (TSCA).
5. It's a good idea to know who in your office who oversees the collection and release of
CBI and to seek help from this person on CBI-related issues.
CBI and sensitive information is covered more in Chapter 7.
7. Controlling Access to Confidential Information
a. Prior to contract award, the CO and COR must first ensure that access to confidential
business information by contractor/subcontractor personnel will, in fact, be necessary during
performance of the contract. If so, the appropriate clauses must be included in the solicitation and
resultant contract to ensure that there is no improper contractor access to confidential business
information, as well as to Privacy Act protected information, or other information, such as
management or enforcement-confidential information. The controls must clearly identify the
procedures or processes that must take place prior to release of any protected information to the
contractor, requirements for confidentiality agreements, and limits on use and disclosure of the
data by contractor personnel.
b.' During contract administration, COs and CORs must review the work assignment or
task order to determine if contractor access to CBI is required for performance. If so, they must
ensure that the release of this data is authorized and accomplished in accordance with all relevant
contract clauses and legal requirements. The COR and CO must ensure that the conditions for
disclosure are met 1) prior to CO approval of the work assignment or task order, and 2) prior to
the COR providing the contractor access to this information.
c. In any situation where a contractor has access to CBI or other sensitive information,
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control measures must be established to ensure that contractors do not have inappropriate access
and to prevent the release of sensitive information to nondesignated contractor employees.
d. Every Agency employee, especially the COR, is responsible for the proper use,
handling, protection, and disposal of information. Access to confidential or sensitive information
must be restricted to authorized individuals who need the information to conduct their jobs.
Understand the sensitivity of the information you are using and what level of protection is
required. If you are unsure about the sensitivity of the information you are handling, ask for help
from your contract-level COR, your CO, or OGC. Ways to protect the information include the
following:
(1) Confirm that the person requesting information is authorized to receive the
information.
(2) When bringing contractors on-site, make sure those around you are aware that
contractors are in the area so that sensitive information is protected and not discussed where
contractors would over hear.
(3) On your computer, use a screen saver with password protection when you step
away from your desk for a few minutes. Log off the network when you will be away from your
desk for more than a few minutes.
(4) E-mail is not a secure means for transmitting sensitive information unless
encrypted. Lotus Notes encryption is lost when the message leaves the EPA network. Do not
automatically forward your e-mail to a non-EPA account or an EPA account of someone not
authorized to receive any material you may receive. (See your Program Office Information
Security Officer for details.)
(5) When using the fax machine:
(a) Confirm and dial the correct number for the document destination;
(b) Do not leave documents that contain sensitive information unattended
at the machine; and
(c) Include a disclaimer on the cover sheet when faxing sensitive
information.
(6) When using a copier:
(a) Do not leave documents that contain sensitive information unattended
at the machine, and
(b) Clear all jams and properly dispose of damaged documents.
(7) Do not place documents containing sensitive information in the recycle bin-shred
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them.
8. New CIause-MBackground Checks for EPA Contractors"
a. Some Agency contracts already contain terms concerning background checks for
contractor employees working in information technology and CBI. OAM in conjunction with
the Office of Administrative Services (OAS) security staff is developing a new clause,
"Background Checks for EPA Contractors" which will cover more contracts. The clause helps to
ensure that contractor employees are able to perform without undue security risks. This clause
will require certain contractor employees, on and off-site, to have background checks or
suitability determinations before beginning work. It is expected the clause will apply to
contractor and subcontractor employees working in the following areas 1) emergency responders,
2) research support, 3) information technology, including CBI, 4) facilities support, and 5)
superfund, not otherwise listed. This background check clause will eventually replace the current
initiative that requires checks for on-site contractor employees only.
b. Many of the details related to this proposed clause have not been decided. Once the
details are worked out, the proposed clause will be circulated within EPA for comment and then
go out for public comment in the Federal Register. In the meantime, OAM developed an interim
clause to require contractors to conduct background checks on their employees and to submit the
background check reports to OAS for adjudication. This will provide the Agency with interim
coverage, on a case-by-case basis, while the Agency formulates a final clause. For more
information, contact Daniel Humphries (202)564-4377 or Paul SchafTer (202)-564-4366 of
OAM's policy staff.
9. Green Procurement
a. In September 2003, the Office of Inspector General issued an audit which found the
Agency's efforts to encourage purchase of recycled goods has not been effective. Agency
employees involved in acquisition, whether in planning or purchasing, should be well-informed
on the Federal and Agency guidance concerning what is called "green contracting." Executive
Order 13101, signed September 14, 1998, expanded and strengthened the Federal government's
commitment in 'Greening the Government through Waste Prevention, Recycling and Federal
Acquisitions." Comprehensive Procurement Guidelines (CPG), Environmentally Preferable
Purchasing (EPP), and the Energy Star Program, are some of the components you should
consider in "buying green."
b. The Comprehensive Procurement Guidelines (CPG) program is part of EPA's
continuing effort to promote the use of materials recovered from solid waste. Buying recycled
content products ensures that the materials collected in recycling programs will be use again in
the manufacture of new products. EPA is required under Section 6002 of the Resource
Conservation and Recovery Act to designate products that are or can be made with recovered
materials, and to recommend practices for buying these products. Once a product is designated,
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procuring agencies are required to purchase it with the highest recovered material content level
practicable. Designated products include items such as paper, binders, toner cartridges, awards,
and plaques. For more information on CPG visit EPA's website www.epa.gov/cDg . Currently,
there are 54 items on the CPG list (see attachment 2).
c. Environmentally Preferable Purchasing (EPP) is the procurement of products or
services that have a lesser or reduced effect on human health and the environment when
compared with competing products or services that serve the same purpose. The EPP Program is
distinguished from some of the more familiar "green" programs which focus on a single
environmental attribute, such as recycling or energy-saving. EPP focuses on multiple
environmental attributes of a product or service, including raw materials acquisition, production,
manufacturing, packaging, distribution, reuse, operation, maintenance and disposal. The EPP
staff in EPA's Office of Pollution Prevention and Toxics developed a suite of databases, training
tools, pilot projects, and frequently asked questions, to assist you in "greening" your
procurement. Please take a few minutes to browse the website at http://www.epa. gov/oppt/epp/.
d. The Government's policy is to acquire supplies and services that promote energy and
water efficiency, advance the use of renewable energy products, and help foster markets for
emerging technologies. This policy extends to all acquisitions, including those below the
simplified acquisition threshold. The Energy Star Program is an example of one of the many
standards established in conjunction with industries manufacturing commercial products to
indicate product compliance with EPP. Additional information about the energy star program is
available at www.enerevstar. gov.
e. Contract clause 52.208-70 encourages the contractor to use recycled paper and to print
¦ deliverables double-sided.
10. Does Your SOW Involve Environmentally-Related Measurements?
a. Many environmental decisions are supported by environmentally-related
measurements. It is essential that environmentally-related measurements be the right type and of
good quality so that the resulting decisions will be sound. Environmentally-related
measurements include the collection, generation, or use of environmental data, and the design,
construction, and operation of environmental technologies. Every SOW, whether for the basic
contract, a work assignment, task or delivery order, must be accompanied by a Quality Assurance
Review Form signed by your organization's Quality Assurance Manager. (A list of Quality v
Assurance Managers, by organization, is available at http://www.ena.gov/qualitv/contacts.html>"^
b. Your Quality Assurance Manager will assist you in determining which quality
standards apply. These standards must be incorporated into the SOW. At a minimum the
contractor will be required to submit a Quality Management Plan and a Quality Assurance
Project Plan (or some combination thereof.) Other documents may be called for depending on
your organization's requirements and the types of services the contractor is performing. The
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COR is responsible for ensuring the contractor satisfies the quality requirements
c. The Contract Management Manual Chapter 46, section 46.1 (formerly Procurement
Policy Notice No. 01-02, Guidance for Use of Higher-level Contract Quality Requirements in
Acquisitions) provides extensive information on quality assurance requirements in contracts.
11. Information Resource Management C. fiKcI h-frfllflo JT ^ciWy
a. Information Resources Management (IRM) is defined as any planning, budgeting,
organizing, directing, training, promoting, controlling, and managing activities associated with
the burden, collection, creation, use and dissemination of information. IRM includes both
information itself, and the management of information and related resources such as personnel,
equipment, funds, and technology. A sample of the areas covered by EPA Directive 2100,
Information Resource Management Policy Manual includes:
- Data Standards
- Information Security
- Information Collection (e.g., public surveys)
- Privacy
- Library Services
- EPA Rulemaking Docket
- Electronic Office Equipment Access for the Disabled (508)
- Information and Data Management
- Hardware/Software/Communications Standardization
To access the entire Directive 2100, see http://eDa.gov/docs/irmpoli8/polman/index.html.
b. If you are managing a contract which involves IRM, your contract will include clause
1552.211-79, Compliance with EPA Policies for Information Resource Management, which sets
forth Agency IRM policies, standards, and procedures. The clause requires contractors to check
the listing of directives referenced in the clause and ensure they comply with Agency standards.
c. As the COR under such a contract, you must monitor the contractor to ensure proper
procedures are followed. Some of the areas you need to be familiar with include:
(1) Contract deliverables must be submitted in both paper and electronic format.
(2) Developing and running Agency databases involves security concerns as well
as agency IT standards.
(3) Any contractor having access to EPA computers needs to follow EPA IT
security policies and procedures including security awareness training on an annual basis. In
some cases background investigations appropriate for the level of access are required.
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(4) Section 508 of the Rehabilitation Act of 1998 requires that all new IT, such as
databases and web sites, developed, procured, maintained, or used by the Agency be accessible
to people with disabilities by providing access to and use of information and data that is
comparable to that provided to other Federal employees and the public without disabilities.
Extensive information on the Section 508 requirements is available at
http://intranet.epa.eov/accessibilitv. For questions related to Section 508 and acquisition, please
contact either Cal McWhirter on (202) 564-4379 or Ed Chambers on (202) 564-4376.
d. Are you my SIRMO? Your organizations^ Senior Information Resource
Management Official (SIRMO) or his/her designee can assist you with questions concerning the
topics discussed above. In Check within your office for who your SIRMO is (the regional
SIRMOs are typically the Assistant Regional Administrators (ARA).
12. Annual Past Performance Evaluations
a. FAR 15.605 and 42.1502 require that the Agency evaluate contractor performance and
use past performance in the source selection process. EPA uses the National Institutes of Health
(NIH) Contractor Performance System (CPS) for both evaluating contractor performance and
obtaining information on offerors' past performance during source selection. The NIH system is
an interactive database on the Internet at https://silk.nih.gov:/cps/epa/homepage.
b. The PO must evaluate past performance for all active Agency contracts no later than
five calendar days after the conclusion the base period of performance and each option year
period of performance. (See http://Lntranet.epa.gov/oamintra/policv/nihdocs/nihindex.htm for the
policy on evaluating contracts with a period of performance of greater or less than one year.) The
CO will initiate the process by assigning an evaluation to the PO on the NIH system and entering
the PO's e-mail address. The PO will then receive an e-mail reminding him or her to log into the
data base and complete the evaluation.
c. POs will rate the contractor in the following criteria:
(1) Quality of Product or Service,
(2) Cost Control,
(3) Timeliness of Performance, and
(4) Business Relations.
While Business Relations is the primary responsibility of the CO—POs are required to provide a
rating and comments for this criterion. The system also contains questions on Subcontracts, Key
Personnel, and Customer Satisfaction. POs merely have to indicate whether subcontracts are
involved, identify the contractor's project manager, and indicate whether the contractor was
committed to customer satisfaction. Comments are optional.
d. The PO has thirty (30) calendar days to transmit the completed form over the NIH
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system (Internet) to the CO. The CO will notify the contractor when the evaluation is ready for
review. The contractor has 30 days to provide a response. In the event of a disagreement on a
rating between the contractor and CO, the final decision shall be made at one level above the CO.
2ed J^
e. Only the CO is authorized to provide the information in the evaluation to the
contractor. All information in the NIH CPS is Confidential/Source Selection Information.
Information contained in the system is to be used for source selection purposes by authorized » ^
personnel within the Federal Government only.
f. For specific guidance on using the system, consult OAM's Intranetsitear
http://intranet.epa.gov/oamintra/policv/nihdocs/nihindex.htm. \X^
13. Providing Government Property to Contractors '
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disposition. If the contract has not been delegated to DCMA for property administration then the
excess property should be reported to the CO for disposition.
e. If you have any property related questions, contact Ed Rosenburg on 202-564-4416 or
e-mail him. He would prefer e-mail so that he can post cross cutting questions and answers in
"Property Tidbits." The "Tidbits" are sent periodically to COs for distribution to their CORs.
14. Printing.
a. FAR 8.802(a) states Government printing must be done by or through the Government
Printing Office (GPO). EPA has authority to do a limited amount of printing in-house; we also
have authority to allow contractors to do a limited amount of printing. These limits are set forth
in EPAAR clause 1552.208-70 which is included in most contracts. Any request for printing
under an EPA contract or a waiver request to exceed the photocopying limits must be approved
in advance by the Agency Printing Officer or the Printing Control Officer and be added to the
contract by the CO.
b. What Is Printing? Printing/photocopying services include (but are not limited to),
any image transferred to paper, plastic/vinyl, CD-ROM/diskette duplication, color
copying/digital copying, black & white photocopying/digital photocopying, liquid ink digital
copying/printing, journal reprints/page charges, and offset printing. Some products that are
classified as printing services include, transit advertising, billboards, as well as printing on
mouse pads, binders/conference folders, kit folders, to name a few.
c. What's the Limit? EPA contractors may provide "duplication, photocopying or
xeroxing" services of less than:
(a) 5,000 units of one page,
(b) 25,000 units in aggregate of multiple pages
(c) 100 pages of multicolor duplication,
(d) 100 diskettes or CD-ROM's.
for any individual requirement (a deliverable). The intent of the limitation is not to allow the
duplication of final documents for use by the Agency. In compliance with EPA Order 2200.4a,
EPA Publication Review Procedure, the Office of Communications, Education, and Media
Relations is responsible for the review of materials generated under a contract published or
issued by the Agency under a contract intended for release to the public.
d. Printing services obtained in violation of these limits will result in the cost of such
printing being disallowed under Agency contracts. If you have any questions about whether an
item is prohibited under the printing clause, or if you want to request a waiver, contact your local
Printing Control Officer or Randall Bacon, Headquarters Printing Officer on (202) 564-9646.
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Appendix to Chapter 2
Document Page Number
1. Conflict of Interest Checklist 2-18
2. Comprehensive Procurement Guidelines Items (54) 2-19
2-17
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Checklist for Recognizing Potential Conflicts of Interest
Consider the following circumstances when planning or managing a contract. If the answer to
any of these is "yes," discuss the situation with your CO or, if this is after contract award, the
contract COR.
YES NO
( ) ( ) Can the potential Contractor perform under the contract in such a way as to devise
solutions or make recommendations that would influence the award of future
contracts to that Contractor?
( ) ( ) If the requirement is for support services (such as engineering or technical
support), were any of the potential offerors involved in developing the system
design specifications or in the production of the system?
( ) ( ) Has the potential offeror participated in earlier work involving the same program
or activity that is the subject of the present contract wherein the offeror had access
to source selection or proprietary information not available to other offerors
competing for the contract?
( ) ( ) Will the Contractor be evaluating a competitor's work?
( ) ( ) Does the Contractor proposed accepting its own products or activities on behalf of
the Government without any Governmental oversight?
( ) ( ) Will the work, under this contract, put the Contractor in a position to influence
Government decision-making, e.g., developing regulations, that will affect the
Contractor's current or future business?
( ) ( ) Will the work under this contract affect the interests of the Contractor's other
clients?
( ) ( ) Are any of the potential offerors, or their, personnel who will perform the contract,
former Agency officials who ~ while employed by the Agency ~ personally and
substantially participated in (a) the development of the requirement for, or (b) the
procurement of, these services?
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Comprehensive Procurement Guideline Items (54)
Paper and Paper Products
Paper and Paper Products
Vehicular Products
Engine Coolants
Re-refined Lubricating Oils
Retread Tires
Construction Products
Building Insulation Products
Carpet
Carpet Cushion
Cement and Concrete Containing Coal Fly Ash
Cement and Concrete Containing Ground
Granulated Blast Furnace Slag
Consolidated and Reprocessed Latex Paint
Floor Tiles
Flowable Fill
Laminated Paperboard
Patio Blocks
Railroad Grade Crossing Surfaces
Shower and Restroom Dividers and Partitions
Structural Fiberboard
Transportation Products
Channelizers
Delineators
Flexible Delineators
Parking Stops
Traffic Barricades
Traffic Cones
Park and Recreation Products
Park Benches and Picnic Tables
Plastic Fencing
Playground Equipment
Playground Surfaces
Running Tracks
Landscaping Products
Food Waste Compost
Garden and Soaker Hoses
Hydraulic Mulch
Lawn and Garden Edging
Plastic Lumber
Landscaping
Timbers and Posts
Yard Trimmings Compost
Nonpaper Office Products
Binders (plastic covered,
chipboard, and pressboard)
Office Recycling Containers
Office Waste Receptacles
Solid Plastic Binders
Plastic Clipboards
Plastic File Folders
Plastic Clip Portfolios
Plastic Presentation Folders
Plastic Desktop Accessories
Plastic Envelopes
Plastic Trash Bags
Printer Ribbons
Toner Cartridges
Miscellaneous Products
Awards and Plaques
Industrial Drums
Manual-Grade Strapping
Mats
Pallets
Signage
Sorbents
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3
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Chapter 3 - Preparation of Work Assignment, Delivery and Task Orders
1. Introduction
This chapter deals with the process of obtaining work from a Contractor. How the work
is given to the Contractor depends on the type of contract. Acquisition personnel define contract
type in terms of how payment is made to the Contractor, while program personnel often use the
term "contract type" to mean what's the purpose of the contract's SOW. If the contract is a Cost
Reimbursement (CR) for Level of Effort (LOE) services, work gets to the Contractor in the form
of a Work Assignment. If it is an Fixed Rate (FR) form of contract, the type of order depends on
what is being ordered. Deliver Orders (DOs) are used for supplies while orders for services are
issued as Task Orders (TOs) to the Contractor.
All packages whether for WAs, DOs or TOs contain certain basic elements: a Statement
of Work (SOW), an Independent Government Cost Estimate (IGCE), and an original or a signed
copy of the COR's Nomination Form, EPA 1900-65. Please note that there may be individual
office, division or other required elements depending upon where you work
2. The Work Preparation Process
Whether a COR is using an Fixed Price (FP), Fixed Rate (FR) or Cost Reimbursement
(CR) contract to task the Contractor, the basics of putting together a work package or tasking
document are the same. If an CR LOE contract is the vehicle used, the method of obtaining work
from the Contractor is either a WA, the former being the method in the majority of Agency
contracts. In the case of FR with TOs and DOs, the order itself is the means of obtaining work.
However, they all start off with a package that contain most of the same basic elements. A
description of these steps and related key issues is presented in the following sections.
D. Pre-approvals as necessary (CMM chapter 2)
D. Assemble the Package and submit to the CO through the Contract COR
NOTE: Although the items are listed sequentially, often the COR would work on the'
SOW and the Independent Government Cost Estimate (IGCE) simultaneously. For example,
after the COR does a rough draft of the SOW, the COR does an estimate of the labor categories,
hours and other direct costs associated with the project. Working on the SOW will help identify
the deliverables the COR expects to receive as the end products of the WA, DO, or TO.
Identifying the deliverables brings to mind the various ways to determine the acceptance criteria
and the QA requirements. Working on the IGCE will usually necessitate a revisiting of and
adjustment to the SOW, incorporating any QA requirements.
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3. Identify the Need
Projects and objectives are directly tied to the Government Performance and Results Act
(GPRA) goals of the Agency and are part of the budget process. Projects are usually submitted
by a COR to his/her manager, then on up through the office, division, and finally the assistant or
regional administrator (AA and RA). Not all projects end up as part of the AA or RA GPRA
budget submission, or, some but not all portions of them. Once Congress has passed the
appropriation and authorizations for the Agency, funding for projects is allocated by AA or RA
and on down through the Division, office and finally to the COR. Occasionally, Congress will
include appropriations for projects that are in addition to, or are different from the Agency GPRA
budget submission. CORs will then have to develop projects and objectives to act on
Congressional language included in the appropriation and committee reports that accompany the
legislation.
A. WAs - Many of the Agency contracts contain broad SOWs and the requirement is for
a Contractor to promise to deliver a fixed number of direct labor hours spread across many
different kinds of professional and technical categories. Because the contract requirement is
given in broad, general terms, all the Government can require contractually from a Contractor is
to provide its best effort. The uncertainty makes a CR pricing format the most reasonable type of
contract to use. At the time of contract award, the Government orders all of the LOE hours and
agrees to issue WAs to the Contractor specifying how those LOE hours are to be used and
describing what specific work it desires. The most frequently used format is a document called a
WA.
B. DO/TO - As outlined at the start of this chapter, DOs and TOs are issued by a CO
under an umbrella FR contract. DOs are used when the primary purpose is to obtain supplies on
a FP basis. When the primary objective is to obtain services using a FR or CR, a TO is issued,
also under an umbrella FR contract.
1. TOs and DOs are used:
- To place orders using the General Services Administration's Multiple Award and
Federal Supply Schedule contracts.
- To place orders under Agency FR contracts, both EPA service contracts for IT and other
resources, and for single FR contracts to cover work for a particular office.
-To place orders against another Agency's GWAC.
NOTE: All work ordered from a Contractor, using a WA/DO/TO, requires planning by the
COR needing the Contractor effort. Whatever the vehicle, the same certain elements are
required: a SOW, an IGCE, a COR nomination and appointment form, and other necessary
documentation.
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4. Statement of Work Types
A contract-level SOW is a written description of the Governments requirements for
supplies or services. SOWs come in three types: level-of-effort/term form, completion, and
performance-based.
/| A. Level-of-effort(LOE)/term - A LOE/Term SOW will describe the requirement in
genefST terminology and have as its objective the delivery of hours of effort. The LOE/term form
SOW describes the work in general terms and obligates the Contractor to devote a specified level
of effort for a stated period of time. A LOE SOW doesn't guarantee the delivery of an end
product or final requirement. With these LOE/term form SOWs, the specifics are delineated in
the tasking document SOWs issued under the terms of the contract.
Under this form, if the performance is considered satisfactory by the Government, the
agreed upon price is payable at the expiration of the agreed-upon period of time, and upon
Contractor statement that the level of effort specified in the contract has been expended in
performing the contract work. Once the end of the performance period for the contract has been
reached, (including any optional periods of performance included as part of the original contract
award), renewal of the effort to contract for a further period of performance is considered a new
acquisition. The new acquisition must either be fully competed, or a CO has to make a written
determination if the previous Contractor is to be awarded that new contract without competition.
"®"NOTE: Because of the differences in obligation assumed by the Contractor, the completion
SOW form is preferred over the term/LOE form whenever the work, or specific milestones for
the work, can be defined well enough to permit development of estimates within which the
Contractor can be expected to complete the work. The term/LOE form must obligate the other
party to provide a specific level of effort within a definite time period in order to be valid.
^ B. Completion Form - A completion SOW has as it's purpose the delivery of a specific
supply item or service. The completion SOW describes the scope of work by stating a definite
goal or target and specifying an end product. This SOW form normally requires the Contractor
to complete and deliver the specified end product or series of end products (e.g., a final report of
research accomplishing the goal or target) within the agreed upon price as a condition for
payment. Partial payments can be made based as the Contractor meets certain milestones.
The Contractor is responsible for completing the work and delivering the end product(s)
within the agreed upon price and time. The government's responsibility is to pay that agreed
upon price for the supplies and/or services rendered. This price is not subject to adjustment
regardless of the Contractor's direct costs which could be higher or lower than the agreed upon
price. There may be an adjustment to the overhead rates.
There may be interim deliverables or multiples of the item. For example, a completion
SOW for an economic impact analysis may have drafts submitted for review, but the end product
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is the analysis, and only that analysis, delivered to the COR.
C. Performance-based SOWs - See Sections below
Performance Based Service Acquisition
5. What is Performance Based Services Acquisition (PBSA)?
a. According to the FAR "performance based services acquisition" means structuring all
aspects of an acquisition around the purpose of the work to be performed with the contract
requirements set forth in clear, specific, and objective terms with measurable outcomes as
opposed to either the manner by which the work is to be performed or broad and imprecise
statements of work.
b. PBSA, formerly called performance based contracts, has been around for decades.
The Office of Federal Procurement Policy issued, "A Guide for Writing and Administering
Performance Statements of Work for Service Contracts," in October 1980. New Federal
initiatives, such as the 1993 Government Performance and Results Act (GPRA) enacted by
Congress, and the President's Management Agenda, which required agencies to begin to produce
performance-based budgets starting with the 2003 budget submission, have brought PBSA to the
forefront.
6. Meeting PBSA Goals
a. The Procurement Executive Council (interagency council consisting of procurement
executives in the Executive Branch) established the following PBSA goals for service contract
dollars obligated for all Federal agencies:
b. In FY2001 we exceeded our goal; however, we haven't been able to meet the goals for
the following years. In March 2003, the Office of the Inspector General (OIG) conducted an
audit to determine whether EPA was effectively implementing PBSA to the maximum extent
possible. Results showed the Agency has been successful with some contracts, such as custodial,
building maintenance, and landscaping services. These types of routine services tend to be the
easiest to convert to PBSA. Our challenge is to continue to find ways to award more PBSA.
Fiscal Year Goal
EPA Actual
2001 10%
2002 20%
2003 30%
2004 40%
2005 50%
11%
16.6%
18%
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7. What Do I Need to Create a Performance-Based Contract?
1. FAR 37.601 states performance-based contracts must have the following elements:
Element
What's Needed
1. Performance Work
Statement
Describe requirements in terms of results required.
2. Performance standards
Use measurable performance standards, i.e., quality, quantity, or
timeliness.
3. QASP
Have a Quality Assurance Surveillance Plan (QASP).
4. Fee/Price Reduction
Specify procedures for reductions of fee or price when services
do not meet contract requirements.
5. Performance
Incentives
Include performance incentives where appropriate.
2. For an excellent, comprehensive performance-based services acquisition reference, try
Seven Steps to Performance-Based Services Acquisition on the Internet. To locate it, go to
http://www.amet. gov/ then select "Seven Steps to Performance Based Services Acquisition
Guide" in the lower, left-hand corner of the screen.
8. How Do I Create a Performance-Based Contract?
1. It Takes a Team... and a Little Research. The first step to writing a PBC is to get
the appropriate people involved. This includes experts in both technical and contractual matters.
Seek out COs and CORs who have or will work on the basic contract or any work ordered under
the contract. Also include program office managers and end-users from past efforts to determine
what worked and what didn't work on similar past requirements. Especially ask about what could
have been done to improve the follow-on contract.
2. Researching the Requirement. The Seven Steps Guide indicates when drafting the
PWS, the acquisition team should ask: What are the desired results (outcomes) of contract
performance? What is the ultimate intended result of the contract and how does it relate to the
Agency's strategic plan? For follow-on requirements, the following should be examined:
(1) Requirements in the basic contract (statement of work, terms & conditions)
(2) Work ordered under the contract, i.e., task orders, work assignments
(3) Monthly progress reports, what was accomplished
(4)Consider regulations, statutes, or court mandates that define the contract's
objective.
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Don't limit research to reviewing old files. Talk to managers about organizational goals and
budget constraints. Talk to end users or customers about their needs, what worked and what
didn't in previous contracts. During market research, involve industry, look for best practices or
innovations used in the private sector or by other agencies. Information captured during your
research will be useful in developing the performance work statement.
3. Conduct a workload analysis by task area: What have we actually been getting under
the task areas and how do we expect this trend to change? Do a historic workload analysis,
looking at trends, reviewing monthly progress reports. Consider what resources are required and
who will provide them. What equipment will the contractor work with (e.g., access to the LAN)?
What resources are necessary to do the job? The foundation for a successful performance work
statement involves a clear answer to three questions: what do I need, when do I need it, and how
do I know it's good when I get it?
4. Formulating the Performance Work Statement (PWS)
a. The PWS is an SOW defined in terms of performance requirements. A key part of
PBSA is stating the requirement in terms of objectives and outcomes versus telling the contractor
how to accomplish the work. A PWS allows the contractor to be innovative in meeting the
Agency's requirements.
«•* On a Superfund removal site evaluation contract EPA specified the desired end
result, not the process to be used. One firm proposed the standard sampling
technology while another proposed an innovative method that met the Agency's
needs and cost considerably less.
b. Based on the research you've conducted, you should have ajjoodjdea-ef^wfeat you
want accomplished. The next step is to outline the major tables and subtasks necessary to
accomplish ihe~requirement. Again, the idea is to tell the contract what outcomes you want
without detailing the process. The less prescriptive the Agency is, the more innovative the
contractor can be. (Exceptions to this would be cases where procedures are mandated by law or
regulation.) Once you've established your tasks, then you can develop performance standards..
5. Conduct Performance Analysis and Select Performance Standards.
Take the tasks that need to be performed and decide how these services can be measured.
How will you know if the contractor developed a good model application? How can you
measure good sample collection? By what standards can these tasks be measured? How do you
know if they are acceptable? By what criteria do you judge them? Generally a standard can be
set for most tasks in the area of timeliness, quality, or quantity. Concentrate on what needs to be
accomplished, not how. Eliminate process-oriented requirements (e.g., job descriptions,
education requirements, level-of-effort) and reports to the maximum feasible extent.
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9. Developing Performance Standards.
1. Rather than inventing metrics or quality or performance standards, use existing
commercial quality standards, such as International Standards Organization (ISO) 9000 or the
Software Engineering Institute's Capability Maturity Models®. One approach is to require the
contractor to propose performance metrics and the quality assurance plan (QAP), rather than
have the government develop it. In conjunction with the CO, consider affording the marketplace
and other stakeholders an opportunity to comment on draft performance requirements and
standards, the Government QA plan, and performance incentives. Many professional
associations also have performance standards. Market research can help you locate commercial
and professional standards.
2. In our sample tasks of developing a model application and collecting samples, there
are industry standards that could be used, such as the American National Standard for
environmentally-related measures which provides a basis for planning, implementing,
documenting, and assessing a quality system.
3. Performance standards should be well-defined, measurable, performance expectations.
Possible measurable standards include:
(a) Quantity of actions
(b) Adherence to the cost estimate
(c) Customer satisfaction
(d) Amount of backlog or rework
(e) Turnaround time or timeliness
(f) Report completeness
(g) Accuracy of analysis
Select only a few meaningful measures on which to judge success.
10. Now that I Have a Standard, How Am I Going to Measure It?
1. After you've developed standards, decide what measuring method to use. There are
two elements to measuring against your standard: 1) a method [how] and 2) a schedule [when].
Surveillance can be accomplished by:
(a) Reviewing standard reports
(b) Querying databases
(c) Reviewing log sheets
(d) Making test calls
(e) Customer Input (survey forms, interviews)
(f) Comparing to an industry standard
(g) Comparing to stated objectives in the statement of work
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2. Next, you need a projected schedule for conducting surveillance. Various schedules
include:
(a) 100% inspection (for critical work, usually involving health or safety)
(b) Random sampling (when there's a lot to inspect)
(c) Periodic inspection
(d) Validated customer complaints
(f) Incidental, impromptu or unscheduled inspection
The method and schedule should be selected with some consideration of cost. For example, you
need to determine that the cost of measurement does not exceed the value of the information.
More expensive means of measurement are used for only the most risky and mission-critical
requirements. For example, should every sample the contractor collects be independently
verified? Is it worth the cost to verify that every help desk call was answered satisfactorily?
11. How Good Does It Have to Be?
After you decide on a standard, a method and a schedule, you need to determine the
acceptable quality level (AQL). The AQL:
(1) Establishes a maximum allowable error rate or deviation from the standard,
(2) Should not be unduly burdensome, and
(3) Should consider the cost, e.g., 100% inspection could be costly.
For example, you may determine that the contractor must transport samples 90% of the time in
accordance with contract performance standard for sample transportation. That means for every
10 times you check, one "error" in sample transportation is acceptable.
12. Fee/Price Reduction for Nonconforming Services
1. As stated in the beginning of this chapter, the FAR states PBC must specify
procedures for reductions of fee or reductions of price when services are not performed or do not
meet contract requirements. Standard clauses in service contracts allow the Government to
deduct payment when services do not meet the contract requirements. How that deduction is
applied will depend on the type of contract. Procedures differ for fixed price, cost-
reimbursement, labor hour or time and material contracts. The amount deducted must represent
as nearly as possible the reduced value of performance.
2. In a fixed rate contract, the Inspection of Services clauses states, "the Government
may require the Contractor to replace or correct services or materials that at time of delivery
failed to meet contract requirements.... the "hourly rate" for labor hours incurred in the
replacement or correction shall be reduced to exclude that portion of the rate attributable to
profit.
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3. In a cost reimbursement contract, the Inspection of Services clauses states, "If any of
the services performed do not conform with contract requirements, the Government may require
the Contractor to perform the services again in conformity with contract requirements, for no
additional fee.
13. When are Incentives Appropriate?
1. The FAR does not require the use of incentives in PBC. However, there are times
when incentives may be useful, such as
(a) Where they will induce better quality performance, e.g., where there is a
history of past performance
(b) For mission essential work
(c) Where the dollar value justifies the expense
2. Incentives for exceeding the performance standard may include:
(a) additional money (e.g., a percentage of the monthly invoice)
(b) additional work (e.g., next phase of the project, award term contracts)
(c) reduced surveillance
(d) favorable pnot pcrfuiinaiice laiing fbf standard being
(e) reduced contract requirements (e.g., reporting)
14. Putting It All Together in the Quality Assurance Surveillance Plan
a. The Quality Assurance Surveillance Plan (QASP) is a chart which usually shows the
performance requirement (from the PWS), the performance standard the contractor must meet for
that task, the surveillance plan(how and when), acceptable quality level, and the deduction or
incentive. The following charts are QASPs from Agency contracts.
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ORD IT Graphics and Visual Information
WorkEIeiifentA
Requirement:
f^rfonnaoce
Measures'
PerformaifceStandards
Surveillance;Methd
-------
ESAT Analytical Lab Support Task Order
Task Area 1: Analytical Chemistry Support
Provide environmental
sample analysis in a manner
consistent with analytical
methods specified in the
ULSA utilizing draft or final
laboratory SOPs
All work shall be performed
in accordance with draft or
approved Standard
Operating Procedures
(SOPs) and raw data to
support sample analyses
shall be provided in all data
packages.
95% of all sample analysis
will be performed in
accordance with a draft or
approved SOP unless this
requirement is specifically
excluded in the TDF. Raw
data for 95% of sample
analyisis shall be included
in the raw data package.
The Task Monitor and/or
Project officer shall review
all data packages for
completeness to the TDF and
adherence to existing SOPs.
No more than one major
correction or rerun of the
sample for every 25 sample
analyses will be necessary
prior to final release of the
data package by the Task
Monitor.
Sample Custodian and File
Manager
Perform sample custodial
duties in accordance with
laboratory SOPs for sample
receipt. Manage files for
each set of samples and
transfer the files to the raw
data set when sample
analyses are complete.
98% of all samples
analyzed shall have
documented custody from
the time that these samples
are received by ESAT until
the final report is sent to the
client.
The Task Monitor and/or
Project officer shall review
chain-of-custody
documentation for samples
and review final data
packages to make sure that
custody sample files are
included in the raw data.
OW Data Base Support (AQUATOX)
PO 2
a) Support shall be timely
a) Support provided within
a) PO will monitor
a) address
and consistent with req'd
two business days after
timeliness of response
in
Example Model
protocols
receipt of TD on 95% of TDs
to TDs
timeliness
Applications
for PPE
b) Quality of tech support
b) All support shall validate
b) PO verify whether
b) address
assists WAM in validating
accuracy of models and
example models
in quality
accuracy of models
include documentation
include documentation
of work in
and adhere to protocols
PPE
c) Example models are
c) Models must be easily
c) PO will monitor
c) address
user-friendly and clearly
understood by at least 75% of
questions and help
in quality
convey potential
potential users
needed by potential
of work in
application.
users
PPE
15. The Statement of Work (SOW)
The SOW is the key document and heart of any acquisition. It's the critical step in the
process because it is closely related to the extent of competition and procurement technique used.
The SOW serves as the basis for determining contract type. The degree of specificity used in the
SOW will be the primary criterion used by the CO in determining which contract type is best
among the various contract types that are available for Federal acquisition.
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The SOW at either the contract or tasking level. The COR uses the basic contract SOW
and prepares a tasking order (i.e.: WA, TO, DO) from the basic SOW which expands direction
for the Contractor. The basic contract SOW defines the overall purpose of the contract,
delineates the contract-level deliverables (such as monthly financial and technical reports,) and
the general standards that the Government will use to determine that the requirements have been
met. The SOW at either the contract or tasking level is the basis for preparation of the
independent Government cost estimate (IGCE). The IGCE is developed by the program office
and is based on the individual elements of cost estimated for each of the components and sub-
components of the SOW. The IGCE is one of the tools used by the CO to determine if the
Contractors proposed price/cost is fair and reasonable.
A Contractor uses the SOW as the basis for development of its proposed response. The
Contractor must understand the SOW requirements sufficiently to develop its technical,
management and price/cost proposals. The SOW must provide enough information without need
for further explanation from the Government. If this is a competitive requirement, the SOW will
establish a uniform basis forjudging accountability and responsiveness of all prospective
Contractor proposals received, and will aid the Government in evaluating and selecting the best
Contractor.
After, contract award, the SOW is used as the basis for ordering work and measuring
Contractor performance. To measure performance, a COR would ask, for example:
- Is the Contractor meeting the milestones set forth in the SOW?
- Do the final reports contain all the necessary data?
- Are the hours being billed by the Contactor commensurate with the amount of
progress?
The SOW, along with the rest of the contract document, becomes the basis for the
Contractor's performance and the Government's measuring standards against which the
Contractor's performance is judged. The SOW is the contract's description of the requirement(s)
that the Contractor is required to follow and deliver. Accordingly, it must clearly describe what
is being procured and contain any special considerations or constraints that apply.
16. Writing the SOW for the WA/DO/TO
A. Defining the importance of the SOW - The statement of work is the most critical
element of the WA, TO, or DO Package. A well written SOW accomplishes the following:
- It facilitates the development of a sound cost estimate.
- It helps ensure a common understanding of project requirements by the Contractor and
the Government.
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- It assists the COR in monitoring the project and evaluating deliverables.
- In contrast, a poorly-written statement of work can contribute to contracting
improprieties and vulnerabilities such as personal services. It can also contribute to
misunderstanding of project requirements and inadequate Contractor performance.
B. Before starting to write the SOW, the COR needs to define the objectives and
Contractor's requirements for the project. While some experienced CORs may be able to do this
as they are preparing the SOW, it is generally advantageous to sketch out the work requirements
in advance by outlining the process using a work breakdown structure (WBS). The planning
stage is also the time for the COR to determine whether the proposed work falls within the scope
of existing office contracts, and whether the work duplicates previous or current efforts.
C. A SOW usually contains the following elements:
1. Title
2. Background for the work assignment/task or delivery order - The background
statement should describe the factors that have led to the project. This may include:
- Current Agency/laboratory/center/office/division management initiatives.
- Relationship of this project to previous or other current efforts. If this is a follow-on to
an earlier task/delivery order/work assignment, identify it by number and title.
- Reference to Agency GPRA/laboratory/center/office/division research program or
project plan that identifies the requirement. This should include the relevant project description
or task description title and number. If appropriate, the relevant sections of the actual project
description or task description can be included as an attachment to the SOW.
3. Defining the Project Objectives (Purpose) - The project objectives describe the
principal goal or result to be achieved by the project. Project objectives should always define a
specific end product or service. Usually when the work is for services, and the specifics of these
services are then described in the succeeding task and deliverable statements.
4. List and description of tasks
This section lists and describes the specific tasks to be performed by the Contractor.
These may either be sequential steps in completion of an overall project or major areas of work.
It is essential that the project be divided into tasks; the absence of this is a frequent cause of
rejection of the work assignment by the Contracting Office. The tasks should be presented in
sufficient detail such that: (1) the scope of the Contractor's requirements is clear; (2) the
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Contractor can proceed without substantial direction from the Government; and (3) both the
Government and the Contractor can develop a sound cost estimate. Thus, for example, reports or
other information to be made available to the Contractor for use in conducting the project should
be clearly indicated.
Many times the requirement deals with research and development, or analysis related to
pending legislation. So it's not always possible to specify in advance what the outcome of a
project will be. This element of uncertainty adds difficulty to the COR's task of writing a clear,
completion oriented statement of work. The question becomes how can a COR deal with a
requirement in which the outcome will only become apparent as the work proceeds? One
effective approach is to organize the work incrementally, issuing technical direction (TD) to
definitize the work as the requirements become clearer. Each TD would build on the results of
the previous one. Alternatively, the COR could divide the work up into options to be exercises
for successive work. A third alternative would be to do successive TOs, DOs, or WAs, but this is
the least preferable approach because it involves much more administrative processing and effort.
5. Identify Deliverables and Delivery Schedule - The COR should define the specific
deliverables and associated schedules to meet the project objectives. All deliverables should be
listed along with their schedule. Due dates should normally be listed in terms of elapsed months,
weeks or days from the issuance of the work assignment. If there are critical deadlines, actual
dates may be specified, recognizing that a delay in issuing the work assignment may require that
these be changed. Both draft and final deliverables should be identified, where appropriate.
While this is often implied in the work statement, it is better to make this explicit, as it will have
time and cost implications. Many EPA WA/TO/DO, especially those performed on-site, are
issued for a one year duration at a time; however, the Government will normally have certain
important requirements which need to be met over that period of performance. Key factors the
COR needs to consider are:
a. What internal EPA products and milestones exist which are supported by
deliverables of the work assignment/task/delivery order, e.g., a budget submission, a peer review
of a research project, an international conference.
b. What specific contractor deliverables are required?
c. Who will review the deliverables?
d. What are the criteria by which the acceptability of the deliverables will be
judged?
e. How much time will be needed for review?
f. When does the overall project need to be completed?
g. When does each deliverable need to be submitted in order to complete the
overall project on time?
In developing schedules for each deliverable, the COR must take into account the
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following:
- The need for both draft and final submissions.
- The possible multiple levels of review. In addition to the COR, deliverables
may be reviewed by the COR's supervisor; technical specialists within the office, division,
laboratory, center or branch; members of a quality action team; or scientists outside the Agency
as part of a peer review process. Certain products may even require AAship-wide review by
management, scientific, or administrative personnel. These multiple reviews may add substantial
time to the schedule.
- Holiday periods and end of fiscal year activities, which may necessitate
extending turnaround times.
- All days should be consistent. The FAR uses calendar days now uniformly
when setting time frames. It is probably a good standard for a COR to use in their tasks as well.
- Acceptance criteria should be specified for each deliverable or category of
deliverable. The particular criteria will depend on the type of deliverable, e.g.. a report, a journal
article, a data analysis, etc.
Although it is listed usually at the beginning of the SOW or on a cover sheet (if
applicable) of the TO, DO or WA, the end date of the overall project should be specified for
completeness when a separate section lists the deliverables. If this is a WA, usually a
Contractor's first task is to submit a WP. The WP should be listed as a separate deliverable. The
due date is specified in the contract under the standard WA or Ordering clause, and is generally
two or three weeks after the CO issues the WA. If this is a TO or DO issued unilaterally by the
CO without first issuing an RFQ, the contractor's staffing and management plan is the first
deliverable after receipt of the TO or DO. Deliverable acceptance criteria should be specified for
each deliverable or category of deliverable.
pgNote: For work assignments involving Information Technology (IT) services, the COR should
include in the acceptance criteria requirements for conformance to design and documentation
standards established by the Office of Environmental Information, Office of Policy and Planning
Division for IT hardware and softwafe related effort.
6. Required format for deliverables, e.g.. format for word processing software
The COR must specify the software for any deliverables when electronic format is the
method the contractor is using to submit deliverables. Specifying the software and type of disks,
CDS, etc. is crucial and frequently overlooked. Any submission must be compatible with
Agency hardware and software. This requirement can be expressed in the sections on
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deliverables or tasks or as a separate item.
¦^NOTE: Contractors are PROHIBITED from printing and have page limits on the amount of
photocopying a Contractor can do. Before a COR requires a Contractor to provide copies, the
COR needs to clear any large photocopying requirements with the Office of Administration and
Resources Management (OARM), Facilities Management Services Division (FMSD), Document
Production, Recycling, and Mail Management Branch for the latest policies or copies of mail
management circulars in Adobe Acrobat format.
7. List of Government-furnished data or property (individual or class deviation required
for this)
It is the policy of the EPA that the contractor furnishes all data and property to
accomplish the task. Sometimes EPA has to provide access to certain Government data. All
CORs are advised to consult Chapter 5 of the Contracts Management Manual and Part 45 of the
FAR and follow the procedures outlined there. Anytime the Government either furnishes
property or reimburses the Contractor for property acquired in the course of the contract, DO,
TO, or WA, the FAR requires a deviation. If this was not done at the contract level, the COR
will have to write a justification and request that the CO do an individual Determination and
Findings for a FAR deviation. If the need for GFP/CAP was not identified at the time of contract
award but instead became an issue later in the effort, the CO will usually do a deviation at the
contract level and modify the contract as a whole.
8. Name of COR
D. Additional elements in a SOW
Depending on the needs of a particular WA/DO/TO, and the terms of the overall contract,
additional items added to a SOW may be:
1. Contractor Personnel Qualifications - Once the tasks and deliverables are defined, the
COR should consider the qualifications of Contractor personnel to perform the work. While it is
not standard practice, the SOW can also require that resumes be provided of proposed staff for
certain specialized tasks. The qualifications must complement the qualifications stated in the
basic contract. For example, when the contract requires investigators to have at least a Master's
Degree in Chemistry and a minimum of six years of practical experience in the area of chemical
analysis, the COR can specify personnel qualifications such as: "The principal investigator must
have an advanced degree in Organic Chemistry and a minimum of six years of documented
experience working with chemical analyses and characterization of organic compounds."
Addressing this issue in the planning stage serves two purposes:
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a. It provides the basis for the specification of particular skill requirements in the work
assignment/task/delivery order. While the COR cannot direct a Contractor to use a particular
staff member, he/she can indicate personnel qualifications and evaluate resumes against these.
b. Along with the description of tasks, it assists in determining whether a particular
contract is an appropriate fit for the WA, TO or DO. As an example, under the training
requirement, the COR may determine that a particular skill requirement is that the Contractor
have a certain number of years as a contracting officer, a specific academic degree, and possess
proven writing skills
2. Required additional reports, e.g., special financial progress reports
The COR may specify additional progress reports beyond the standard monthly combined
technical/financial progress reports called for in the contract. These may include, for example:
- Weekly oral reports or brief bi-weekly written reports.
- More detailed financial reports, e.g., list of hours by staff member
- Requirement to notify the Government when a certain percentage of the funds for the
task/delivery order/work assignment has been expended: 40%, 70%, 80%.
The COR should review any additional reporting requirements with the contract COR.
The COR must balance the additional benefits to be gained by such reports with the additional
Contractor costs they'll entail. Additional reports will add to the workload of the COR for
review and file documentation. Frequently, such requirements are established for the contract as
a whole, through a modification to the contract.
3. Suggested skill mix, e.g.. estimated hours by labor category or professional level;
however the Government's IGCE is never provided to the Contractor.
As a general rule, the COR should NOT suggest the labor mix. The TO, DO, or WA
should be the document that states the Government's need (the what), and the plan written by the
contractor is the document that states the how and by whom. To give the contractor anything on
labor mix and hours would only be done for certain, very specialized requirements where there
would be no other way for the contractor to determine whom to assign to the project.
4. Selecting References and Background Information - The COR should identify
reference materials for use by the Contractor in responding to the work package. This could
include the section of the Regulation, United States Code or other project that this requirement is
supporting. It could also include technical manuals, deliverables from prior work
assignments/tasks/delivery orders, or relevant Agency, or other Government reports, directives or
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guidelines.
5. Ensuring that the Project Does Not Duplicate Other Work - The COR should make
every attempt to be sure that his/her project is not duplicating prior or ongoing effort in another
part of the organization or Agency. So the COR should discuss the requirement with his/her
supervisor and other personnel in the organization as a double check for duplicate prior or current
work. Planning Worksheet (Exhibit 4-1) presents a worksheet which the COR can use to outline
the major features of the WA, TO, or DO. The completed worksheet can be used as a reference
in writing the SOW.
6. Special requirements or restrictions - If any tasks involve advisory and assistance
services and/or sensitive or vulnerable services, the SOW should identify the management
controls. The background and objectives are frequently combined, as are the deliverables and the
schedule. Also, quality assurance requirements should be included in the tasks and deliverables
(or in a separate section) for projects involving environmental data collection.
17. Purpose of the Independent Government Cost Estimate
The COR must provide, with the SOW, an estimate of the total Contractor costs to perform the
project. This is often called the Independent Government Cost Estimate (IGCE) and is
required for all TOs, DOs and WAs over the simplified acquisition threshold (currently
$100,000.00). However, the CO has the authority to ask for an IGCE at any time and for any
dollar amount if the CO deems it necessary to determine a fair and reasonable pnceT The
purpose of the IGCE is:
1. It supports budgeting for the division, branch, project, laboratory, center, or office.
2. It provides a basis for reviewing the Contractor's technical work plan and cost
estimate.
3. It supports an audit trail of the factors that went into the planning of the project.
Without an independent Government estimate, the COR is placed in the position of
having the Contractor's cost proposal define the budget for the project. The Contractor may be
proposing a substantially greater effort or more costly mix of personnel than the COR believes
are needed for the project. The higher cost, in conjunction with the costs of other work
assignments, may cause the total ceiling of the contract or the overall contract budget for the
branch or section to be exceeded. The Contractor's cost estimate may in fact be reasonable, but
without a basis for comparison, judging reasonableness may be difficult. Also, the absence of
independent Government cost estimates for some TO, DO, or WAs has been found to be a
vulnerability in the Acquisition Management Reviews. Thus, it is essential that the COR
develop this estimate.
At this point, the type of contract pricing determines the approach a COR takes in
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developing her/his IGCE. If the prices are already set for line items, tasks or labor categories, the
COR uses those for the cost per hour or price per item. The COR's most important task is to
determine the number of hours that are appropriate for each of the tasks or subtasks in the COR's
WBS, and then to compute a rough estimate of the ODCs (the number of trips if travel is
involved, the number of people to make the trip, long distance telephone calls, etc.) If the FR
contract is for commercial items or supplies, the IGCE will be constituted of the fixed prices for
the items listed in Schedule B of the contract. If the contract is a CR LOE one, putting together
the IGCE is less precise since the direct labor costs used are composites from the Contractor's
original cost proposal or an average hourly rate based on all previous labor costs on previous
WAs, which may not reflect the actual expenditure of effort for the CORs current requirement.
18. Elements of an Independent Government Cost Estimate
In order to put together a realistic IGCE for a WA/DO/TO, a COR needs to understand
the elements that make up a Contractor's costs. A cost proposal submitted by a Contractor is
make up of both direct and indirect costs of doing business. Part 31 of the FAR addresses these
elements in much more detail. Contractor's costs have to meet three criteria. They must be
allowable (as defined in FAR Part 31), allocable, and reasonable. Most costs are allowable for
both Federal and commercial contracts and part of accepted business practices. However,
because it is the public taxes that are used in Federal contracts, there are certain costs the laws
and regulations, deem unallowable, such as interest, advertising, fines and penalties assessed for
violation of Federal, state or local laws, and alcohol.
For a cost to be allocable, it must be demonstrated that it was a cost that was directly or
indirectly incurred as a result of effort attributable to a specific contract, or, if part of an indirect
cost, to a class of Federal contracts. For a cost to be determined to be reasonable, it should be
one that most normal and prudent business people would pay in a competitive environment. The
cost also has to be consistent with a Contractor's normal operations. For example, a Contractor
cannot charge their commercial customers one rate for photocopying and a.different rate for the
Federal customers.
For the purposes of this text and the task of compiling an estimate, a short description of
the elements in a Contractor's costs follows:
A.. Direct Costs - direct costs are directly identifiable to a specific project and include
labor and other costs that are passed through and billed to the Government.
Direct Labor represents the actual wages paid to the Contractor's employees for their work on the
contract. Most contracts specify various labor categories which are expected to be required on
the contract. For example, a contract scope of work might specify the following categories:
Professional Level 4 - Project manager or senior environmental scientist with a Ph.D. or
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equivalent and 10 or more years of experience.
Professional Level 3 - Environmental scientist with an M.S. degree or equivalent and 6 to 12
years of experience.
Professional Level 2 - Environmental associate with a B.S. degree or equivalent and 3 to 8 years
of experience.
Professional Level 1 - Junior associate with a B.S. degree or equivalent and 3 years or less
experience.
Technical Level 3 - Senior environmental technician with 3 to 6 years of experience.
OR
Senior Economist - An individual with a Ph.D. in economics and ten or more years of experience
doing economic impact analyses, risk management in the area of economics. This person has
written dozens of articles that have been published in recognized scientific journals and has
participated in peer review panels for several Government Agencies including EPA. May have a
Bachelor's or additional degree in business management or mathematics.
Junior Economist - An individual with a Master's Degree in economics and four or more years
of experience in economic methodology, economic analyses, economic areas of risk
management. Has had some published articles in recognized scientific journals.
Economist - An individual in an entry-level position with a Bachelor's degree in economics
possibly including a minor in business or mathematics or English. This person has at least one-
year of experience gained in summer jobs or intern programs.
Writer/Editor - An individual with a Master's Degree in English and at least five years of
experience developing, writing, and editing material for reports, manuals, instruction books and
related technical and technical publications.
Statistician - An individual with at least a Master's Degree in Mathematics and at least five years
of experience in conducting sampling research, developing statistical surveys, analyzing
statistical impacts resulting from testing data.
Researcher - An individual with a bachelor's degree and 4 plus years of experience doing
research of verbal or statistical data to prepare reports and studies for use by professional workers
in a variety of areas of economics.
B. Other Direct Costs - Other Direct Costs are costs, other than labor, that can be
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attributed directly to the project. Examples are travel, equipment, copying, subcontractors,
telephone and computer time. This category could also be where consultant costs are listed
rather than as direct labor. Remember, the Contractor must be consistent in the way it charges
costs on all work under the Contractor. The most common elements of a Contractor's ODC's
are:
Travel - long distance and local
Copying
T elephone/ facsimile
Computer time
Equipment and supplies
Postage/express mail
Other (e.g.. messenger, training)
C. Indirect Costs- Indirect costs are the costs of operating the business. They are not
associated with one particular contract but apply to a Contractor's multiple Government
contracts. Indirect costs include fringe benefits, overhead, and general and administrative
expense. The classification of costs as overhead or G&A may vary somewhat by company. A
Contractor that does both Government and commercial contracting will usually segregate his
indirect cost pools into Government and non-government because many of the normal costs of
doing business in the private sector (i.e.; interest on business loans, alcohol for company picnics)
are unallowable and prohibited on Government contracts.
The most common indirect costs are:
- Fringe benefit costs are costs associated with sick leave, annual leave, tuition
reimbursement, insurance contributions, and other "fringe benefits" for the Contractor's
employees. Fringe benefits are generally calculated in the form of a percentage of direct labor
costs. Direct labor overhead includes costs such as rent, furniture, supplies, business equipment,
marketing costs, and non-direct secretarial support costs.
- General and Administrative Expenses (G&A) usually includes the administrative costs
of operating the business. This typically includes the costs of the company's president or other
senior officers, as well as labor and other costs for financial, personnel, legal and other
administrative support. G&A is expressed as a percentage of the sum of labor costs, fringe costs,
overhead costs, and ODCs. Some companies combine overhead and G&A costs into one rate.
The direct labor overhead and fringe benefit rates are usually expressed as a percentage of the
direct labor costs. Many companies combine fringe and direct labor overhead costs into one rate.
bs'NOTE: What goes into a Contractor's various indirect cost pools is different for each
contractor. Some companies will charge photocopier costs to an indirect pool while others make
a direct charge to a contract for each copy made. Comparing indirect rates between contractors is
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like comparing a sedan and an SUV - both are modes of transportation but the seats, engines,
wheel size varies greatly.
^NOTE: Many large companies who do business with the Government have to submit the cost
elements being accumulated in each of their indirect pools to an auditor for approval. The Cost
Accounting Principles require a Contractor to be consistent across all Government contracts. In
other words, Contractor ABC cannot charge clerical support to an indirect cost pool for
Department of Energy contracts and charge it directly to all EPA contracts. Any company that
does both private and Federal work almost always sets up separate indirect rate pools because of
the prohibition against certain costs being allowable on Federal contracts A contractor will have
different Government overhead rates, based on whether the work is performed at the Contractor
(off-site) or Government (on-site) location. The on-site rate will most likely be lower, if the
office space, furniture and equipment is furnished by the Government.
D. Fee - Fee is the amount the Contractor earns above its costs on a contract. The fee is
the Contractor's profit. The fee percentage is applied to the sum of all of the above costs. Fee is
usually one figure, but on CPAF contracts, it consists of two parts: a base fee and an award fee.
By law, fee is limited (except for R&D effort) to 10% of the total costs. Although in the initial
cost proposal, the contractor proposes fee as a percentage of total proposed costs, once the CO
negotiates fee, that percentage is converted into a fixed dollar amount per labor hour and is no
longer a percentage of the Contractor's costs. A cost plus a percentage of cost is an illegal
contract. In a CR, the CO determines that dollar value of each hour delivered, and the fee paid
on each invoice is based upon the number of hours delivered. This is the ratio of the direct labor
hours performed in a given period (usually a month) to the total direct labor hours authorized for
the contract period.
19. Developing the Independent Government Cost Estimate
The IGCE is a required element of all work packages prior to ordering work from a
Contractor. Whether dealing with CR or FR contract, the first and the most important step is to
estimate the direct labor hours required. Procedures for developing the labor hour estimate are
presented below. Following this discussion, three alternative methods of estimating costs are
presented, in increasing order of complexity.
Estimating Direct Labor Hours - In this step, the COR estimates the labor hours by personnel
category and total to perform the TO, DO or WA. The procedures are as follows:
1. Identify and list the major tasks across the top of the page. These tasks should be the same as
in the TO, DO or WA SOW, but should be expanded into subtasks to accurately estimate hours.
2. List the staff categories expected to be required down the first column. These may be
obtained from the contract COR or from reviewing the contract. Reviewing previous TOs or
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WAs for similar effort are also an excellent source.
3. Estimate the hours required by each personnel category to perform each task. As an aid to
developing this estimate, you may wish to indicate the length in weeks or months of each task on
a chart. In doing this, consider:
-The length of the task
-The particular work activities required
-The number of people, foil-time or part-time, expected to be required
4. Sum the labor hours by task to estimate the total labor hours by staff category and for the
whole requirement.
The above process is not a simple activity. It requires careful thought as to what work
will be required and how it will be approached. There are several ways, however, that this
process can be shortened. For example:
If the project is very similar to one that was conducted in the past, you may estimate the
total hours based on the prior effort with minor adjustments based on new requirements.
If the number of staff categories is few you may estimate the total hours by task (or overall), and
then apportion the total by staff category based upon experience.
If the project will involve a fairly level concentrated effort, especially if the project is
on-site, you may estimate the number of people required for a given period (e.g.. 6 months),
adjusting for full- or part-time staff. For example, you may judge that the project requires a
project leader half-time for 6 months, a senior scientist full-time for 6 months and a technician
full-time for 6 months.
20. Estimating Costs - Full Costing Method
This method is the most detailed approach to cost estimating. In this method, individual
cost factors including labor costs, fringe benefits, overhead, ODCs, G&A and fee are applied
explicitly to estimate total work assignment costs (Exhibit 4-3).
The method involves the following steps:
Step 1 - Estimate direct labor hours for each perspnnel category (from Direct Labor Hours
Worksheet)
Step 2 - Determine average salary rates for each personnel category.
Step 3 - Multiply direct labor hours for each personnel category by the average salary rate for
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that category. This gives total direct labor costs.
Step 4 - Multiply total direct labor costs by the fringe rate. This gives fringe costs.
Step 5 - Multiply total direct labor costs and fringe costs by the overhead rate. This gives total
overhead costs.
Step 6 - Add ODCs to the sum of labor, fringe and overhead costs.
Step 7 - Multiply the above total by the G&A rate. This gives G&A costs.
Step 8 - Add labor, fringe, overhead, ODCs and G&A costs. This gives total costs.
Step 9 - Multiply total costs by the fee percentage. In a CPFF contract, this is the fixed fee. In a
CPAF contract, the fee for estimating should be the sum of the base fee and the maximum award
fee.
Step 10 - Add the total costs and the fee amount. The result is the total estimated cost and fee for
the requirement.
If the Contractor does not have a separate fringe or G&A rate (e.g.. fringe and overhead or
overhead and G&A are combined), then the corresponding steps are omitted. The COR may
obtain the average salary rates; fringe, overhead and G&A rates; and fee percentage from the
following sources:
- From the contract COR.
- From the Contractor's cost proposal, invoices, work plan cost estimates, or other
financial reports.
The full costing method is useful in the following circumstances:
1. Information on the various cost factors is readily available to the COR. Individual
loaded labor rates are not provided.
2. Significant amounts of ODCs are envisioned.
3. The labor mix is expected to be substantially different from the mix on prior work
assignments with the Contractor.
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21. Preparing The Work Package and Assembling it
The work package is the collection of documents and forms which the COR submits to
the contract COR. The contract COR reviews the package prior to sending it the CO who will
issue the TO, DO, or WA. The SOW is the most important element of the package. The IGCE,
including any assumptions made, is also a required part of the package. In addition, there are
several other elements of the which the COR needs to prepare. Not all of these are required on
every project. In some offices, the contract COR may prepare some of these items. The COR
should coordinate with the COR PO to ensure that all of the necessary forms and documents are
completed. A complete package would include most of the following:
1. Cover Sheet or Memo WA, TO, or DO Form
2. Procurement Request (EPA Form 1900-8) - See note below
3. Contracting Officer Representative's Nomination Form (EPA Form 1900-65)
4. Copy of the Certificate of Training
5. Quality Assurance Review Form
6. Non-duplication of Effort Statement (required by some Contracting Offices)
7. SIRMO approval for IT services (as needed)
8. FMD approval for use of multiple appropriations (as needed)
9. Intra-agency funding request and approval (as needed)
10. Government-Furnished Property worksheet
11. Justification and Approval for Sensitive and/or Vulnerable Services (as needed)
NOTE on Funding for the various types of contracts. CR contracts are funded at the contract
level. In a FR contract, delivery orders and task orders are separately funded documents. They
fit under the umbrella of the FR contract, but they are obligating and tasking documents that
stand on their own. The typical CR LOE contract orders all the hours but not the work the hours
are to be devoted to. The FR contract itself orders nothing, not even hours, from the contractor
and guarantees it only a minimum of work. The bulk of the work a Contractor receives is
dependent on requirements placed as orders by the Government with nothing that can be counted
on except the minimum amount the Government must order. Chapter 6 on Financial
Monitoring: Invoice Review Process delve into this topic in greater detail.
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Appendix to Chapter 3
Document Page Number
1. Sample of SOW Work Breakdown Structure (WBS) 3-27
2. Exhibit 3-1 - Planning Worksheet: Defining The Work 3-28
3. Exhibit 3-2 - Statement of Work Review Checklist 3-29
4. Exhibit 3-3 -Cost Estimating Worksheet 3-31
5. Exhibit 3-4 - Planning Worksheet: Other Direct Costs 3-33
6. Exercise 3-1 3-35
7. Exercise 3-1 - Sample Work Assignment 3-36
8. Exercise 3-1 - List of Labor Categories for Sample WA 3-41
9. Worksheet for Labor Cost Estimate for Sample WA 3-45
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Sample Of SOW Work Breakdown Structure
Task 1 - Develop classroom materials for a 5-day course based upon the attached learning
objectives to include a student text, an instructor's guide, 2 different competency-based final
exam of no less than 50 questions based upon the learning objectives, and student exercises for
practical application of learning objectives.
If using visual aids, the software graphics presentation must be in Microsoft PowerPoint, Office
Professional version 2000 or higher and using an editable (not view only) version. If using vu-
graphs, they can be either translucent or plain paper.
All documents shall be provided in draft to COR for subject matter expert (SME) review.
(iii) Task 3 - Prepare all documents in final deliverable form to the COR. All text must be in
Microsoft Word 2000 or higher version. If using CD disks, they must be "read and write"
capable. Diskettes must be standard IBM formatted compatible 3 Vi" diskettes.
(iv) Task 4 Develop student registration and evaluation form using same software as in Tasks 2
and 3.
(v) Task 5 - Conduct 6 classes in Washington, DC and one class in each of EPA's 10 Regions,
and 6 laboratory facilities for a total of 22 class sessions. Contractor is responsible for providing
all instructional materials.
(vi) Task 6 - Set up a training schedule by working with training officers in attached list.
(vii) Task 7 - Provide Internet link for on-line registration as well as a toll-free number for
student registration. Class size must not exceed 24 students per session.
(viii) Task 8 -At the end of each class session, have students complete evaluation and appoint 1
student to collect them. The student who collects the evaluations will place them in a postage
paid envelope provided by the contractor and mailed by 1 student to the COR.
(ix) Task 9 -After COR provides copies of student evaluations to Contractor, summarize
evaluations and write a report including issues discussed and issues that need to be followed up
on by EPA COR. At the conclusion of all 22 course presentations, write a final report.
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Exhibit 3 -1
Planning Worksheet: Defining The Work
1. What are the objectives of the project?
Does the project duplicate previous or current work?
How do these objectives relate to the Program or Project Plan?
2. What tasks must be accomplished to achieve these objectives?
Task Number Description
3. What deliverables are required? (Reports, articles, briefings, databases, measurements,
meeting agendas, etc.) How will you evaluate the acceptability of deliverables?
Deliverable Acceptance Criteria
Who will review the deliverables?
How much time should the review require?
4. When does the overall project need to be completed?
5. When does each deliverable need to be submitted in order to meet the final completion
date? (Allow sufficient time for Government review and Contractor response to review
comments.)
- Deliverable Date Required
6. What skills, experience and levels of personnel are needed to perform the work?
7. What references and background information will the contractor need to understand the
requirement and perform the work? (Program Plan, Technical Manuals, Agency reports,
regulations, directives, guidelines, etc.)
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Exhibit 3 - 2
Statement of Work Review Checklist
1. Requirements are consistent with the scope of work of the contract
(requires coordination with Project Officer). Indicate relevant
section(s) of contract SOW
2. Background statement provides sufficient information to enable
understanding of context of the project.
3. Objective(s) are clearly stated.
4. References (e.g., to Project Plan) are included, as appropriate.
5. Tasks or task areas are listed and described and are consistent
with the background/objectives.
•Scope of Contractor requirements is clear.
•Responsibilities of Contractor and Government are clear.
•Information to be made available to Contractor is indicated.
6. Deliverables are listed and described.
•Schedule (due dates) for each deliverable are specified and realistic.
•Draft and final deliverables are listed, as appropriate.
•Acceptance criteria are specified, as appropriate.
•Electronic format is specified, as appropriate
•Copying requirements do not exceed the printing limitations,
by deliverable.
7. Overall period of performance is provided. This does not exceed
period of overall contract.
8. Management controls are described, indicating how EPA will ensure
adequate input to and review of Contractor work.
9. Staff requirements are specified, as appropriate.
10. Quality assurance requirements (e.g.. data quality objectives,
audit requirements) are provided, as appropriate.
11. Special requirements (e.g., additional reports) are specified,
as appropriate.
3-29
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12. Services do not create appearance of personal services. ( )
13'. Services do not include inherently governmental functions. ( )
14. Services do not represent organizational conflict of interest for ( )
proposed Contractor.
3-30
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Exhibit 3-3
COST ESTIMATING WORKSHEET:
FULL COSTING METHOD
Contract No: Contractor:
Step 1 — Determine labor hours by personnel category (from Direct Labor Hours Worksheet)
Step 2 — Determine average salary rate for each personnel category
Step 3 ~ Determine total direct labor costs
Labor Category
Hours
Unloaded
Labor Rate
Labor Cost
Senior Editor
456
X
40.00
18.240
Junior Editor
896
X
27.00
24.192
Staff Assistant
920
X
16.00
14.720
Secretary
120
X
15.00
1.800
X
—
X
—
Step 4 ~ Multiply total direct labor costs by fringe rate
Total Direct Labor Costs 58.952
X Fringe Rate .3
= Fringe Costs 17.686
Step 5 — Multiply sum of total direct labor costs and fringe costs by overhead rate
Labor Costs + Fringe Costs 76.638
X Overhead Rate .4
= Overhead Costs 30.655
3-31
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t.xaroit .?• - ^ ^otitmuea)
COST ESTIMATING WORKSHEET
FULL COSTING METHOD
Contract No:
Contractor:
Step 6 -- Add tolai ODCs (freu; ODC Worksheet) to sum of labor, fringe and overhead cost
Labor -r Fringe - Overhead Costs i 07.293
+ ODCs 7.600
= Total Costs before Get A 1 1-AS93
Stco 7 -- iVjfolnoiv total costs before G&A by G&A rate
X Ci:A Rate
™ ^ os^s
»*- <"> a j * i -j . : r* o i i ¦"> «, .
bteo s — Agc totai eos^s colore 'j.-5:a aoct kjccA costs
.L14.S2.3_
i
Total Costs Before G&A
-- G&A Cosrs
-- Total Costs
13.757
¦ I -.R93
Stc-n 9 — Mi'LIr.
totsi costs uv ice i:er-:cr>:as!
.a.. '_.os. :¦>
' •-> '* 1 CT/Ti
ree iu'iiour.t
_1?TT7_
128.680
J2T^S0_
'"\ <*>
10 9 0.1
Step 10 — Add Fee Amount to ; oial Costs. Result is Total Zsriroar
eo l.ost rims res
CCnuucd Cost Plus Fee
S i 38 9""
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Exhibit 3 -4
PLANNING WORKSHEET: OTHER DIRECT COSTS
Contract No.:
Contractor:
WA, DO, or TO No.: _
WA, DO, or TO Title:
Task
ODC Category
1
2
3
4
5
6
Total
Travel
Long Distance
Local
2,000
2,000
4,000
300
Copying
100
50
50
400
600
T elephone/F acsimile
450
Computer Time
300
Equipment/Supplies
1,500
1,500
Postage/Express Mail
450
Other
Total ODCs
7,600
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In estimating long distance travel costs, the COR should consider the
anticipated number of trips, the average air fare, and the number of days
and rates of per diem and car rental. For example, if the Contractor is
estimated to make 6 plane trips of 2 days each, then the long distance
travel might be estimated as follows:
6 trips at $500 air fare = $ 3,000.00
6 trips at $ 50 local travel = 300.00
12 days per diem at $ 100/day = 1,200.00
12 days car rental at $40/day = 480.00
Total travel estimate = $ 4,980.00
In lieu of a breakdown by task, certain ODCs such as local travel, copying,
telephone and postage are often estimated by using an average total
cost/month for the work assignment, e.g., $200 - $600/month. Thus, for a
6 month work assignment, these charges might total $1,200 - $3,600.
Such charges would either not exist or would be much lower for on-site
contracts.
For many WAs, TOs, or DOs, the application of a percentage factor for
ODCs (e.g.. 5-10%) is sufficient. TTie COR needs to determine when to
use the more detailed approach.
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Student Exercise No. 3-1
In groups using following SOW, develop an Independent Government Cost Estimate for the task
order. Depending on group size and time available, different groups may be asked to develop the
IGCE for different segments of the task order SOW.
1. Take the attached statement of work and read the night before and use it to develop an
Independent Government Estimate.
2. Using the labor information provided, identify the types of contractor employees by
education and experience that will be needed to perform all the tasks you've outlined and
assign them to a labor category: i.e. program manager, senior instructor, junior instructor,
researcher, technical writer, administrative assistant, meeting moderator, quality assurance
officer, etc.
3. Using the worksheet at the back of this module, estimate the number of hours for each labor
category that will be needed to perform all the tasks related to conducting this training.
4. Total up the hours by labor category and subtask as part of an IGE.
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Sample Work Assignment
Indoor Air Quality Tools for Schools 2001 National Symposium
I. Background:
According to a government study, half of our nation's schools have infrastructure problems that
have a negative impact on indoor air quality and energy use. The challenge for EPA's Climate
Protection Division and Indoor Environments Division is to address the relationships between
indoor air quality and energy use as they relate to health risks, pollution prevention, economic
competitiveness, environmental education and environmental protection.
Twenty percent of the U.S. population, nearly 55 million people, spend their days in our nation's
K-12 schools. This creates a tremendous opportunity to significantly reduce health risk, save
energy, and ensure a healthy environment for children and staff by focusing EPA's efforts on the
116,000 public and non-public K-12 schools [Source: US Department of Education] nationwide.
EPA's Indoor Air Quality Tools for Schools (IAQ TfS) and Energy Star are programs designed
to encourage schools to meet these goals voluntarily. Implementation of these two programs in
our schools can provide a high quality and healthy learning environment with decreased
absenteeism and, potentially, increased test scores for our students.
U.S. EPA's Indoor Environments Division has determined one of the most efficient means of
combating this problem is through public education. Therefore, EPA IED will be holding the
second annual National Indoor Air Quality Tools for Schools Symposium during the summer of
2001. The goal of the symposium is to educate and equip school officials, school nurses and
community groups to implement EPA's Indoor Air Quality Tools for Schools (IAQ TfS)
Program. In obtaining this goal education and discussion will occur around various aspects of
an indoor air quality program including cost-benefit, energy efficiency, health effects (including
asthma) and effective communication strategies.
II. SCOPE OF WORK
In meeting the requirements of this task order, the contractor shall be in a support role and
will NOT be involved in the development of EPA policy, nor in any other activity that is an
"inherently Governmental function."
TASKS:
Task 1: Prepare a work plan
The contractor shall prepare a detailed work plan and cost proposal in accordance with Contract
68-WX-XXXX. Prior to development of the work plan, the Contractor can choose to meet or
talk on the phone with the EPA COR, to discuss technical questions that may arise from the task
order and ensure a common understanding of the goals. The work plan and cost proposal shall
contain:
~ details of how the contractor will complete all task order tasks;
an estimate of labor hours by labor category and costs by tasks, as well as for the overall
task order;
~ Complete breakout of ODC's (other direct costs)
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The Contractor shall begin work on the task order tasks while the work plan is under
development specifically work requested under Task 2 & 3, if necessary.
The contractor shall notify the Contracting Officer and COR when 75% of the Task order hours
and/or costs have been used.
Deliverable:
• After meeting or talking with the EPA COR, the Contractor shall provide a work plan in
accordance with the contract schedule.
Task 2: Determine Location, Dates and Logistical Arrangements for the IAQ TfS
Symposium 2001
The Contractor shall finalize the location, dates and logistical arrangements for the IAQ TfS
Symposium 2001, including securing the meeting space. The 2001 Symposium will be held in
the Washington, DC - Baltimore Corridor. The target dates in sequential order as follows:
August 9-11, 2001; August 2-4, 2001; and July 26-28, 2001. The EPA COR prefers
Washington, DC as a first choice, but availability will be determining factor. The logistical
needs for Symposium 2001 include the following:
• Close proximity for major airports and public transportation.
• Meeting Room Space for approximately 300 attendees
• Breakout Room Space to accommodate 5 sessions simultaneously
• Meeting Room Space for Awards Ceremony on first evening
• Hotel Rooms for approximately 100-150 individuals (the cost for these rooms will not be
covered by this WA)
• Registration Area
• Space for no more than 10 Booths
• Ensure there is available audio/visual equipment at the symposium
Deliverable:
2.1 Within 10 days of approval of the work plan the Contractor shall deliver a memo
listing all details and logistical information for the 2001 Symposium.
Task 3: Attend 2001 Symposium Planning Meetings
Planning and organization for the 2001 Indoor Air Quality Tools for Schools Symposium is led
by EPA and co-sponsored by participants from organizations in the IED Partner Network such as
American Lung Association, National Education Association, American Association of School
Administrators, National Association of School Nurses, National Association of County
Officials, National Organization of Black County Officials, Allergy and Asthma Network *
Mothers of Asthmatics.
The Contractor shall attend all planning meetings. All meetings will be held within the
Washington, DC area (local travel). While attending these planning meetings in person the
Contractor shall provide support, expertise on IAQ TfS and planning large national meetings.
During these meetings the Contractor shall take notes and follow-up on actionTtems as
determined by the planning committee.
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Dates, times and location of all planning meeting information will be provided to the Contractor
by the EPA COR.
Deliverable:
3.1 Within 1 week following each planning meeting, the Contractor shall deliver to
the EPA COR a brief memo outlining all key points for that meeting, a list of
action items in it's entirety and a separate action item list for the Contractor. This
list shall contain delivery dates for these items.
Task 4. Communications, Outreach and Product Development Support
for 2001 Symposium
The Contractor shall provide communications, outreach and product development support for the
IAQ Tools for Schools .2001 Symposium.
Under this Task the Contractor shall provide support in educating and communicating
symposium goals, anticipated outcomes and benefits for attending the 2001 symposium to actual
schools/school districts, schools based non-profit organizations, health related organizations,
community-action groups, private sector industry allies and general private sector organizations
who deal with schools, and press.
The contractor shall provide general communications and outreach support for the IAQ Tools for
Schools symposium. Upon receipt of technical direction the Contractor shall develop and
promote general awareness messages to targeted publications, newsletters, web-sites, etc. as
determined by the EPA COR.
Upon receipt of technical direction the Contractor shall develop documents for IAQ Tools for
Schools Symposium. This shall include marketing, outreach and communications products. The
Contractor shall provide prototype layout/illustrations and draft the final text for brochures, fact
sheets, charts, posters, 1 short video, banners, signs, letters, presentations, etc. Prior to
developing any documents, cuirent documents shall be reviewed for applicability and to avoid
duplication of efforts. The Contractor shall be developing no more than 10 new documents for
the IAQ Tools for Schools Symposium.
After receipt of sample agendas, agenda topics, sample applications and fact sheets from the EPA
COR, the Contractor shall develop one draft of each: the 2001 Symposium agenda, application,
and fact sheet.
Deliverable:
4.1 Within 1 week of receipt of technical direction from EPA, the Contractor shall
provide a memo listing options for providing communications and outreach support.
Upon receipt of EPA COR's comments, the Contractor shall implement the approved
ideas on the memo.
4.2 Within 2 weeks of receipt of technical direction from the EPA COR, the
Contractor shall develop documents for the IAQ Tools for Schools Symposium.
The 1st round draft copy of the IAQ Tools for Schools documents shall be
delivered to the EPA COR within 2 weeks of receipt of TD. The Contractor shall
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incorporate EPA COR's comments and deliver next draft, etc. within 2 weeks.
4.3 Within 1 week after EPA COR provides sample agenda, application and fact sheet,
the Contractor shall deliver drafts to the EPA COR. The Contractor shall incorporate
EPA COR's comments and deliver next draft, etc. within 1 week.
Task 5: Recruit Participants to attend the 2001 Symposium
EPA has identified School and Health-based Organizations and groups (such as Association of
School Business Official, National Association of School Boards), schools/ school districts, and
other organizations that would benefit from attending the 2001 Symposium. Upon receipt of this
list, the Contractor shall provide support in recruiting these audiences to attend the Symposium.
The Contractor may recruit other organizations/school districts (other than those listed on the
EPA list) that could benefit from attending the Symposium.
Deliverable:
5.1 Within 1 week of receipt of EPA identified list, the Contractor shall deliver an
inclusive list of audiences to be recruited to attend the Symposium to the EPA
COR.
5.2 The Contractor shall deliver a memo listing activities and status on a monthly
basis.
Task 6: Provide Support for Symposium Break-Out Sessions
The Contractor shall provide support for the break-out sessions held at the 2001 Symposium,
including agendas for breakout sessions, material development, presentation support, facilitation.
The EPA COR will deliver technical direction with name of breakout session and support
activities.
Deliverables:
6.1 Upon receipt of technical direction, the Contractor shall deliver within 1 week
draft agendas, ideas for support materials.
Task7: Provide On-Site Support for the Symposium
The Contractor shall provide on-site support during the entire duration of the Symposium.
Support shall include: registration table, booth area support, overarching smooth operation and
execution of the conference. The Contractor shall be on-site for the Symposium in order to
ensure registration and Symposium activities runs smoothly and make adjustments if necessary.
DELIVERABLE INFORMATION AND DISTRIBUTION LIST
All deliverables shall include the date, contract and task order numbers/title, task number, and
the term "Deliverable" on the front cover. Final deliverables shall be submitted in hard copy and
in electronic form.
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Addressee
EPA Contract Manager
EPA Task Order COR
Number of Copies
1 Copy(transmittal memo only)
Original + 3 Copies
EPA Task Order COR Mailing Address: Delivery Address:
Name:
Phone Number:
E-Mail:
A SCHEDULE AND DELIVERABLES:
Task No.
Deliverable
Due Date
Task 1:
Work plan
Within the guidelines of Contract.
Task 2:
Memorandum with logistical details
Within 10 days after the approval of the
Work Plan
Task 3:
Memorandum with key points, action
items
Within 1 week following each planning
meeting
Memorandum with contractor action
items with due dates
Within 1 week following each planning
meeting
Task 4:
Memo listing options for providing
outreach and comm. support
Within 1 week of TD from EPA
COR
Develop documents/make revisions
Within 2 weeks of TD from EPA
COR/within 2 weeks of receiving EPA
COR comments
Develop draft agenda, applic., fact
sheet/Make revisions
Within 1 week after COR provides
samples/Within 1 week after receiving
EPA COR comments
Task 5:
List of audiences to be recruited
Within 1 week or receipt of EPA list
Memo listing recruitment status and
activities
Monthly Basis
Task 7:
Draft agendas, ideas for support
materials/Begin providing support for
breakout sessions
Within 1 week of receipt of TD from
EPA COR/Upon Feedback from EPA
COR
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Labor Categories Available for Sample Work Assignment
1. Program Manager (PM)
Minimum ten years experience in energy-efficient technologies with advanced analytical and
technical skill in lighting design, application, operation, or maintenance.
Minimum five years experience in lighting design, application, operation, or maintenance, as
well as working knowledge of the lighting industry, current technology, and market
opportunities.
Demonstrated ability to manage complex tasks and coordinate difficult project logistics,
including the development and completion of financial plans, cost estimates, projections, and
time lines.
Demonstrated ability to apply facilitation and conflict resolution techniques to reach consensus
in project initiation, progress, and completion.
Demonstrated ability to manage large volumes of task orders, delivery orders, work
assignments, or projects concurrently.
Minimum Bachelor's Degree from an accredited institution.
2. Senior Policy Analyst (SPA)
Minimum ten years experience in public policy analysis related to energy- efficient technologies,
energy-saving installation techniques, electric utility demand, supply and energy production, and
investment incentives.
Minimum Bachelor's degree from an accredited institution.
3. Senior Automated Data Processing (ADP) Manager (SAM)
Minimum ten years programming experience with experience in database development for
environmental, energy, or policy-related data analysis.
Demonstrated experience in Clipper and several other programming languages, such as Oracle,-
C++ or other state of the art programming languages. Must demonstrate proficiency in at least
one database language, and superior programming abilities in Windows and Internet publishing.
Demonstrated experience in managing projects of greater than $1.0 million on an annual basis in
ADP activities.
Demonstrated ability in the operation of Windows and DOS based programs.
Demonstrated ability in translating and communicating process of data management to technical
and non-technical audiences.
Minimum Bachelor's degree in Computer Science, Information Systems, or Mathematics from
an accredited institution.
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4. Senior Lighting Specialist (SLS)
Minimum ten years experience in lighting survey and installation for commercial, industrial, and
governmental buildings.
Minimum two years experience in the lighting industry developing strategies for increased
lighting quality, general financing, cost savings, investment returns, and future market
penetration.
Experience in presenting and demonstrating techniques in lighting design and installation to
diverse audiences.
Ability to train personnel to better understand and communicate lighting energy concepts (i.e.,
footcandles, lumens, watts, etc.), technical applications and potential energy savings to
customers.
Minimum Bachelor's Degree in Architecture, Engineering, Building Sciences, Physics, or related
field from an accredited institution.
5. Senior Energy Systems and Building Specialist (SESBS)
Minimum of ten years experience in design, installation, and maintenance of integrated energy-
saving systems technologies for buildings.
Minimum of three years experience in analysis of existing facility conditions, analysis of
financial or organizational constraints of various clients and the analysis and the recommendation
of options to maximum energy savings.
Experience in the use of computer modeling to project potential cost savings. Valid license in
Mechanical Engineering or related field.
An active valid Professional Engineering license in Mechanical, Electrical, or Architectural
Engineering..
Minimum Bachelor's Degree from an accredited institution in Engineering, Systems
Technology, or Architecture.
6. Senior Communications Specialist (SCS)
Minimum ten years marketing and communications experience in environmental or energy-
related field.
Experience in communicating with corporate, government, and/or academic audiences.
Experience in conceptual design and graphic development of publications, multi-media
packages, and exhibit materials.
Minimum Bachelor's degree in Communications, Business Management, English, or related
communications field from an accredited institution.
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7. Policy Research Assistant (PRA)
One year experience in environmental policy research and analysis.
Minimum Bachelor's degree from an accredited institution.
8. Automated Data Processing Analyst (ADPA)
Minimum three years experience in Clipper, C++, Oracle, or other state of the art programming
languages.
Expertise in programming and database languages.
Expertise in Windows programming and Internet publishing.
Minimum Bachelor's degree from an accredited institution in Computer Science or related area.
9. ADP Technical Support Specialist (ATSS)
Ability to operate Windows and DOS based programs.
Experience in providing customer service in a high volume environment.
Ability to type a minimum of 40 words per minute.
Minimum Associate's degree from an accredited institution or a high school diploma with a
minimum 2-3 years related experience.
10. Lighting Specialist (LS)
Minimum one year experience in energy conservation and/or lighting projects.
Minimum Bachelor's degree from an accredited institution.
11. Communications Specialist (CS)
Minimum two years experience in public speaking and graphic presentations to corporate,
government, and/or academic audiences.
Minimum Bachelor's degree from an accredited institution.
12. Building Systems Specialist (BSS)
Minimum two years experience relating to heating, ventilation, and air conditioning projects.
Minimum two years experience working with energy-efficient technologies.
Minimum Bachelor's degree in Architecture, Engineering, or any area related to Building
Science or Facility Management.
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13. Hotline Operator (HO)
Experience in providing customer service to a wide variety of customers.
Minimum Associate's degree from an accredited institution.
Experience in working in DOS and Windows-based programs.
14. Support Personnel (SP)
Support personnel includes but is not limited to typists, clerks, draftspersons, reproduction
specialists, proofreaders, editors, quality assurance specialists, designers, and other personnel
who charge direct labor that the contractor deems necessary to support technical personnel (Key
and General) in accomplishing work statements specified herein. This group provides
administrative compilation and clerical support to the Key and General Personnel. Most of this
support is characterized as routine and/or repetitive in nature. Support personnel must have a
high school diploma and the capability of operating general office equipment.
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Labor Cost Estimate Worksheet
for Sample Work Assignment
For each task in the statement of work (the tasks are listed below this chart), determine which contract labor categories are needed, then estimate how
many hours that labor category would need to complete the task. When you complete this, total the labor hours for each task in the column on the
right.
PM
SPA
SAM
SLS
SESBS
scs
PRA
ADPA
ATSS
LS
cs
BSS
HO
SP
Total
Hours
Tasks
1
H
i
2
£
2J>
2
3
11-
3
4
>C
L
, *-
w
2-0
'4
5
1
10
5
6
1
SL
¦ 4L
6
7
£°-
%
K
30
m
7
liu
Total
Hours
Total
Hours
ask Titles:
Vork Plan
ingements
Meetings
it Support
irticipants
t Sessions
; Support
-------
1
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Chapter 4 - Reviewing the Contractor's Work Plan
1. Introduction
This chapter describes methods for reviewing the Contractor's work plan (WP) in
response to a CO issued work assignment (WA). Procedures for reviewing the.technical and cost
portions are discussed, along with ideas on developing approaches for the CO to use to negotiate
any changes necessary.
2. Work Plans Submitted By A Contractor
Depending on the contract type, the response to a tasking document varies.
A. Work Assignments
The predominate type of Cost-Reimbursement (CR) contract at the Agency are level-of-
effort/term types with general statements of work (SOW) that contain a variety of task
descriptions which the contractor may or may not be asked to perform. The contract itself orders
all of the hours' for a specific period of performance. Work is actually obtained from the
contractor using a WA as the tasking document issued under the Agency cost-reimbursement
(CR) contract. It's the overall contract itself that orders all of the hours.
Generally, all EPA CR WA contracts require a Contractor to submit a work plan (WP) in
response to individual work assignments. The submission of a WP is the first task and
deliverable required by the WA. The amount of time a Contractor has to respond depends on the
WA clause in the contract. As a general rule, CORs should include the requirement for a WP in
the WA SOW. The Contractor is allowed to start working (sometimes working only on the
technical and cost plan) while the technical and cost work plans are being reviewed.
There are two clauses in the main contract that govern the required detailed information
the Contractor must submit: 1552.210-70 "Reports," and 1552.210-71 "Work Assignments."
Although these contract clauses may or may not specify a particular format for the WP, in
general the overall contract usually requires a detailed technical approach, a staffing plan for key
or critical Contractor staff, and a detailed cost estimate. The COR can require additional details
and specific content, but none of these added details can supercede the terms and conditions of
For some DOs and TOs, the Contractor submits a proposal (technical and cost) in
response to a Request for Quotation (RFQ) and the review is done prior to the CO issuing the
DO/TO. Issues about the technical aspects and elements of the costs proposed are dealt with
before the Contractor starts work. This is especially true if it was a multiple award situation.
the main contract.
B. Delivery Orders and Task Orders
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For other DO/TO placement, the CO issues the DO/TO to the Contractor based upon the
package submitted by the COR. The Contractor is allowed to start working (sometimes working
only on the technical and cost plan) while the technical and cost work plans are being reviewed.
Whether a WA or a DO/TO, the COR needs to be familiar with the content of the
reporting requirements of the contract to ensure that the COR is not asking for information that
conflicts with the contract. The COR cannot use a WA/DO/TO to eliminate any of the reporting
requirements embedded in the contract, either. However, if after determining what the contract
requires and balancing that need against the needs of the individual COR, the COR may indicate
more specific reporting requirements in the WA/DO/TO.
NOTE: COR's need to keep in mind that requiring additional information, over and
above what the basic contract requires, from a Contractor will add to the cost of the work.
3. Reviewing the Contractor's Work Plan Oty'.
In all of the following discussions, the text assumes thatfhe WA/DO/TO was issued by
the CO prior to receiving any technical and cost response from the Contractor. To facilitate
review and ensure both EPA and the Contractor have a common understanding of the
WA/DO/TO work plans usually include the following elements: (NOTE: not all WPs contain
each of these elements.)
1. Statement of project objectives
2. Detailed technical approach for accomplishing the work, including a list and
description of tasks/action steps
3. List and description of each deliverable
4. Schedule for overall project and for individual tasks/deliverables
5. Management and staffing plan ~ how the Contractor proposes to organize and staff the
project
6. Responsibilities of various staff
7. Names of proposed personnel, including subcontractor staff or consultants
8. Anticipated problems, if any
9. Suggested changes to the work assignment requirements, if appropriate
10. Detailed cost proposal
a. Hours by professional level staff (PL) or labor categories
b. Total direct labor costs
c. Other direct costs by line item (i.e., travel, copying, subcontractor)
d. Indirect costs
e. Consultants
f. Fee (based on the LOE hours)
g. Total cost and fee
4-2
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Although resumes are typically not submitted, the COR can request them in the
WA/DO/TO by requiring the Contractor to submit resumes outlining the qualifications of staff to
perform the work. This would generally be done only on selected projects requiring very
specialized skills. Other information the COR may require includes:
V
Cost estimate by task ^
4. Review Timeframe
- Person loading chart, indicating estimated hours by staff category by task V l|P ^
r/
a^ cV
The amount of time a contractor has to submit a Proposal of WP and the amount of time
the COR has to review it and recommend approval/disapproval is clearly stated in the WA or the
Ordering clause of the contract. If it's a WA, that clause also states that the Contractor must stop
working at the end of a certain number of calendar days unless the CO has approved the WP or
extended the time period for review. If it's a DO/TO, issued unilaterally, the Contractor must
respond within a certain number of days if the Contractor disagrees with any of the elements in
the DO/TO. No submittal by the Contractor assumes that the Contractor agrees with the SOW,
staffing, and costs. Also, if the CO disapproves a work plan, the Contractor must stop work until
the problem causing the disapproval is resolved. (Note: In some pilot projects between OAM and
the program offices, OAM has delegated the approval authority to the contract COR.)
The COR can recommend approval, disapproval or partial approval of the WP/proposal
to the CO through the contract COR. Therefore, to allow sufficient time for notification to the
contract COR and the CO, the COR should complete his/her review in less calendar days than
are required for CO approval. Failure to perform the review and notify the Contractor of the
approval of the Contractor's proposed work plan/technical plan/management plan/staffing plan
within the stated period of review constitutes a "constructive rejection." This means that the
absence of action by the two levels of CORs and the CO is construed as a rejection of the work
plan (unless otherwise specified in the contract).
5. Items Included in the Review
The COR needs to review the response from the Contractor to determine if the
Contractor's understanding and approach are consistent with the SOW of the WA/DO/TO.. The
Contractor's technical approach and the cost proposal should be reviewed concurrently, since the
two are interrelated (i.e., the Contractor's management and staffing plan is described in the
technical proposal, and the proposed hours by staff level are shown in the cost proposal).
A sample checklist for evaluating the Contractor's response is included in the chapter.
For convenience, the checklist presents the review elements for the technical and cost proposals
separately.
The various items in the checklist are largely self explanatory. Regarding the use of
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Government-furnished property (GFP), the COR needs to ensure that a the contract includes a
deviation to the FAR if the COR believes it necessary and in the Government's best interests to
either furnish Government property or to allow the Contractor to purchase and the Government
reimburse the direct costs of acquiring the property (CAP = Contractor Acquired Property.) If
there is a contract level deviation, then the COR needs to write up a justification of need for the
WA/DO/TO and submit the 7-point document through the contract COR to the CO. The
justification of need is usually part of the package described in Chapters 3/5. When the
justification is determined to be acceptable, the CO will issue a modification to the contract
authorizing the use of GFP or the Government paid for acquiring of property by the Contractor.
Until the modification has been signed by the CO, the COR is not authorized to provide GFP to
the Contractor, or to give the go-ahead to the Contractor to acquire property. If an individual
deviation is required because there is none at the contract level, the process will take several
weeks and requires much more paperwork.
6. Items of Special Importance to Review
In reviewing the work plan against the items in the checklist, several points are of special
importance. Look for additions, deletions or changes in the task descriptions, as well as any
renumbering of the tasks in the SOW. This is not necessarily a problem, as long as any changes
have been explained. For example, the Contractor may change the order of tasks outlined in the
SOW to create a more logical flow of the work. Or the Contractor may divide a task into two
tasks in order to describe the work more clearly. These changes are most probably acceptable.
On the other hand, the Contractor may propose adding a task which was not specified in the
SOW nor contemplated by the COR This may be judged appropriate to accomplish the
objective, or it may reflect an activity which the Government does not wish to undertake at the
time. All such cases should be identified and analyzed.
Note any additions or deletions to changes to the schedule of deliverables. If some
deliverables have been omitted, this should be flagged. If the schedule for completion of certain
deliverables differs from the dates in the SOW, assess whether the revised schedule is
reasonable. The COR should note any proposed format for specialized reports. Determine
whether the Contractor has presented a detailed technical approach to accomplishing the work.
A simple restatement of the SOW tasks is not acceptable. The Contractor's technical approach
should include, f6r example, potential topics to include in the final report, data bases to be
reviewed, analytical methods to be used, or individuals to be interviewed. The technical portion
of the WP has to provide enough detail to ensure that the Contractor's understanding of the
requirements is consistent with that of the COR.
Compare the hours proposed with the Independent Government Cost Estimate (IGCE). If
the hours vary by either labor categories used (same number of hours as the Government estimate
but a different mix of skill levels) or total hours to be expended from what was calculated for the
Government estimate, this may indicate a lack of a meeting of the minds. This disparity can be
higher or lower, and these is no magic percentage rule of thumb for deciding if the difference is
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significant or not. It is determined individual assignment/order by assignment/order. When the
Contractor's estimate of labor hours and other costs exceeds the IGE, this may indicate a need to
scale back the tasks to a level that can be sustained by the COR's budget for the work. Compare
the Contractor's total estimated cost with the Government's cost estimate. If the Contractor's cost
exceeds the Government estimate, this may also be a strong indicator that the scope of work,
technical approach or staffing plan may need to be adjusted.
Analyze the Contractor's proposed travel and training costs, if any. Contractor training
costs are of particular concern to the Agency. As indicated in a February 28,1992 memorandum
from the Assistant Administrator, OARM, and in a May 27,1994 memorandum from the
Director, OAM, the Government should not be paying to train Contractor staff to provide the
basic services called for in the contract. For example, the Contractor has a responsibility to
make sure its personnel are provided with and know how to operate the common commercial
software used in the workplace. If using certain computer software is part of the contract SOW
that the Contractor competed for and won, the Contractor is expected to train its employees at its
own expense and provide fully qualified staff for employment on the contract. The Government
should only be paying for specialized, non-commericial training associated with using a new
method, a piece of equipment or an Agency-unique software program not available through any
other venue.
The COR needs to pay particular attention to the proposed use of subcontractors and the
proposed plan of the prime Contractor to manage their subcontractors. Analyze whether the
contractor has indicated any anticipated problems, work dependent on information the Contractor
has identified as being required from the Government but wasn't included in the COR's estimate
of the effort, or areas the Contractor has indicated need clarification or modification.
NOTE: The Contractor must submit a revised WP or staffing plan when there is a change in the
SOW, labor hours or categories, or period of performance in an on-going WA/DO/TO.
I 7. Questions to Consider when Reviewing the Technical Approach of a Contractor's
/Proposed Plan of Action/Workplan
all of the elements or just some of them? "
A. Does Contractor demonstrate complete understanding of the project? Is it demonstrated for
B. Are the milestones the Contractor proposes appropriate/too generous/too ambitious/too
conservative?
w
C. Can the Contractor's effort be reasonably accomplished within the hours proposed? Are the
number of hours inflated or unrealistically low (Contractor is in essense buying in and assuming
addtional dollars and hours will be found later on)?
D. Is the proposed staffing plan appropriate and reasonable? Is it consistent with the technical
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approach?
E. Is the Contractor proposing qualified personnel? Is the Contractor proposing to use over-
qualified staff for routine tasks?
F. Is the Contractor identifying any Government Furnished Property (GFP) needed? Is this a
new requirement? Has the use of GFP been authorized in the contract or is this going to require
a deviation to the FAR for this WA/DO/TO?
G. Has the Contractor identified any questions, areas of concern, or indicated areas which need
to be resolved?
t\ t
Vi" 8. Questions to Consider when Reviewing the Cost Proposal Portion
o1
^ A. Are the hours appropriate?
o B. Are the direct labor rates reasonable for the amount of work being done?
C. Is the labor mix appropriate for the type of work being done?
D. Are the indirect cost percentages (fringe, direct labor overhead, general and administrative)
consistent with those negotiated and stated in the overall contract?
E. Are the proposed costs for any subcontracted effort reasonable?
F. Is the proposed amount of travel acceptable? Do the travel costs appear reasonable?
G. Did the Contractor provide enough of a detailed breakdown of the other direct costs? Is each
component reasonable?
H. Is the Contractor proposing acquiring property (CAP requires the same deviation and
justification of need if the Contractor is going to bill the Government for all the costs associated
with its acquisition since, if the Government pays for an item directly, it becomes Government
property.)
I. Is the Contractor using subcontractors or consultants that are already consented to by the CO
and listed in the overall contract? (If the Contractor is proposing to use a new subcontractor, this
will take extra time for the CO to review any subcontract agreement between the prime and its
sub and consent to it.)
9. Reviewing and Commenting on the Work Plan
Based on the COR's review of the Contractor's proposal, the COR should recommend to
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the contract COR one of four actions-
1. To accept the work plan as presented
2. To negotiate changes to the work plan with the Contractor
3. To amend the statement of work for the work assignment. This may involve adding or
deleting tasks or deliverables, changing the period of performance, or changing the labor hour
estimate.
4. Amending the SOW of the WA/DO/TO, frequently is done in conjunction with the ^
CO's negotiations with the Contractor. X)
P
«®"NOTE: At any time the COR can recommend partial approval of a Contractor's technical
approach for some tasks but not others. The CO would then sign off accepting those portions of
the technical approach. Or the staffing plan and the labor costs associated with them could be
approved while negotiating the technical portion.
10. Assisting the CO with Negotiations with the Contractor
It is very important for the COR to remember that Contractor's proposals can be
negotiated. However, the only individual with negotiation authority is the CO. The COR
plays an important role in identifying the areas of difference between the Contractor and the
Government, for example:
A. The Contractor's approach is unacceptable and shows a lack of understanding of the
requirement.
B. The skill mix is inappropriate because the Contractor is using overqualified
individuals for routine staff work.
C. The Contractor has included tasks that are unnecessary and bloat the direct labor
hours and costs.
D. The hours and labor costs are not commensurate with the ambition of the technical
approach and past history on projects of this complexity demonstrates that many more hours and
much more cost will be required in order to ensure the project is completed by the required date.
E. The Contractor didn't include all of the deliverables as required by the SOW.
F. The Contractor's approach is good and the costs reasonable, but the Contractor's
proposed schedule is not acceptable.
Whenever a COR becomes aware of potential problems or areas of dissonance, the COR
needs to notify the contract COR of his/her concerns, and preferably in writing. The CORs
should meet to discuss discrepancies or questions, and plan a negotiation strategy. The contract i
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COR in the course of meeting with the COR may also have identified problems or questions that
need answers.
The next step is to contact the CO on the contract to set up a negotiation session with the
Contractor. The actual negotiations can be done in person or via a teleconference. The CO' is the
only one authorized to conduct negotiations with the Contractor, but it is advisable for the
contract COR and COR to participate since the CO relies on their expertise in the technical area
to reach an acceptable agreement.
NOTE: There is a difference between negotiation and clarification. The COR, with
proper notification of the contract COR, can act within his/her authority to contact the
Contractor's Program Manager, for clarification of aspects of the technical, staffing or cost
portions of the proposal. However, if there is going to be give and take on the contents that will
result in the Contractor's submitting a revised proposal, or verbally saying the Contractor will
change something, this becomes more of an area of negotiation and the CO must be involved in
that process.
11. What's Not Negotiable
All CORs need to remember that some things are not negotiable.
A. No one has the authority to dictate how a Contractor conducts business or makes its
business decisions.
B. The Government cannot compel the Contractor to use a particular individual or
subcontractor/consultant.
C. The Government cannot tell the Contractor how to perform the work in great detail or
in terms of specifying the methods the Contractor will use to divide the work and staff
responsibilities.
D. At no time can the Government direct the contractor in a way that constitutes or gives
the appearance of personal services (See Chapter 5).
The COR can request resumes of proposed staff and review them to make sure they have
the necessary qualifications of education and/or experience which were included in the SOW
issued by the CO. The COR has the right to reject staff that don't meet those qualifications.
If the Contractor, CO and CORs can't resolve differences in either technical or cost areas,
or both, the CO would disapprove the Contractor's proposed WP.
Other areas that will require the involvement of the CO are:
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1. Use of a subcontractor or consultant not previously consented to under the overall
contract.
2. Use of a subcontractor that would require an adjustment to the hours above the
negotiated and approved ceiling for that subcontractor.
3. These issues are addressed by the CO and the contract COR, however, the COR needs
to be aware of how they can affect the timeframe for approval of the Contractor's proposal
involving modifications to the contract which take a longer period of time than that normally
involved in the approval process.
The important thing to remember is that the COR should always keep both the contract
COR and the CO informed when serious issues arise.
12. Summary of Negotiations
At the end of any session, the parties must summarize the agreements reached. This can
be done verbally with a follow-up written account that both parties sign-off on. This
summarizing at the end ensures that all parties, the CO, the COR and the Contractor, have the
same understanding about any agreement. Ultimately, the outcome will become an official
record for the file. The written documents should contain, at a minimum:
1. Date of negotiation session
2. Names of participants for both the Government and the Contractor
3. The issues discussed and the agreements reached
4. Any unresolved issues
The CO or, if delegated authority, the COR will draft a letter to the Contractor that
identifies changes, if any, needed to the Contractor's cost or technical proposal. The letter will
be sent to the Contractor by the CO or, if delegated, the COR.
13. Amending/Modifying the WA/DO/TO
When a change is necessary, the WA has to be amended by the CO or the DO/TO has to
be modified by the CO. In most cases, the issues raised by the COR when reviewing the
Contractor's proposed technical approach, staffing plan and cost proposal can be resolved
through negotiations with the Contractor and by the Contractor's submission of revised portions
of the plan after conclusion of negotiations. There are no uniform Agency guidelines on when to
request an amendment/modification. If the parties have agreed, for example, to delete tasks, add
tasks, add or delete or change deliverables, change the dates for final deliverables, then these
changes require a WA amendment or a DO/TO modification. If the COR Or contract COR have
questions on whether an amendment/modification is required, they should consult the CO.
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The procedure for preparing an amendment/modification request is discussed between the
CORs and the CO. The body of the amendment/modification may be written by the COR, but
only the CO has the authority to issue it. The COR should prepare a memorandum to the
contract COR addressing the need for the amendment/modification and providing appropriate
background information. An example of such a communication is:
"I have reviewed the Contractor's technical approach of its proposal and would
like to request a modification to my task order. The purpose of this modification is:
- To modify the SOW in the task order to add a task (or tasks.) Attached is a
description of the additional or revised task(s.)
- To modify the SOW to delete a task (or tasks). Attached is a revised SOW with
the deleted task (s) removed.
- To modify the SOW to revise a task (or tasks). Attached is the SOW with
task(s) revisions.
- To revise the period of performance (shorten or lengthen). Attached is a revised
schedule."
NOTE:'Some Contracting Officers use an amendment to a WA to approve a WP. Other
COs will use a memorandum; while others signify the approval by their signature on a standard
office WA form used by some program offices. Although the format may change, the COR
needs to prepare whatever memo, cover sheet, etc, the CO and the contract requires. The COR
will indicate that the technical approach, professional/ technical staffing plan, labor mix,
estimated labor hours, other direct costs, total costs and completion date (as originally proposed
or revised through negotiations) are acceptable. The COR then submits it to the CO through the
contract COR. Whenever a new COR starts to place work with a Contractor, he/she should
check with the CO and contract COR to determine how the process works for that particular
contract.
14. Contract Situations Where Performance is Authorized Before Approval of a
Contractor's Proposal/Work Plan
While most of these Agency CR LOE contracts authorize the Contractor to start work
immediately upon receipt of a WA issued by the CO, some contracts only authorize the
contractor to work on the planning associated with responding to the WA with a WP (technical
approach, staffing plan and cost proposal). Only after the Contractor's response has been
submitted and approved by the CO, does the contractor work on the rest of the tasks in the
WA/DO/TO. This delay in starting other tasks may be desirable where funds are tight or the
requirement is very complex, and the COR wants to make sure that there is common
understanding between the Government and the Contractor before too many labor hours and
costs have been expended. A COR may wish to put that kind or other kinds of limits in the
individual SOW if time permits. This further demonstrates the need for timely review of the
work plan by the COR. Because of the variations, the COR needs to consult with the contract
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COR as to what is standard operating procedure and what would be the best way to handle the
tasking and the specific review and approval and/or disapproval requirements for the particular
contract. If there is nothing to preclude the unilateral issuing of a tasking document, often it is
the deadlines and other time constraints that dictate whether the CO issues the ordering/tasking
document before obtaining a technical and cost estimate from the Contractor.
The biggest difference between WAs and DO/TOs is that, with a CR LOE contract, the
CO issues the WA prior to the Contractor assembling its proposal/WP; whereas with a DO/TO, it
can be handled either way. Some of EPA's FR contracts have an order that covers all of the
proposal costs for a Contractor to respond to an Request For Quotation (RFQ), others issue the
RFQ to all Contractor awardees, evaluate the responses, and then award the DO/TO to the
Contractor that presents the best overall value to the Government, both technical and price/cost
considered. In either case, the COR CAN NOT direct the contractor to start work prior to the CO
signing the WA/DO/TO.
A. CR Contracts - Most CR contracts authorize the Contractor to start work as soon as
the CO issues the WA. There are others that limit the Contractor's work to just the WP. The
COR can always limit the Contractor to working only on the WP or set a limit on the number of
hours the Contractor can utilize prior to approval of the Contractor's proposal. However, usually
the contract itself will specify a point at which work is to stop if the WP approval has not been
received, or if the WP is rejected. Therefore, timely review of these documents is critical to
ensure that the work is completed on time. Delays on the part of the Government can excuse a
contractor, under the terms of the contract, from continuing performance
B. FR Contracts - Depending on the contract's terms and conditions and the pricing
arrangement, the CO may unilaterally issue the DO/TO and require a response from the
Contractor within a specified number of days.
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Appendix to Chapter 4
Document Page Number
1. Checklist for Evaluating Contractor's Response/WorkPlan,
Technical Approach and Staffing Plan 4-13
2. Exercise 4-1 4-15
3. Sample Contractor's Work Plan 4-16
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Checklist for Evaluating Contractor's ResponseAVorkPlan,
Technical Approach and Staffing Plan
Does the proposed approach and plan contain the following elements?:
Statement of objectives
List and description of tasks
List and description of deliverables
Schedule for overall project and deliverables
Management and staffing plan
List of proposed personnel and their labor categories and roles
Does the Contractor demonstrate a complete understanding of the
requirements?
Is the approach to the WA/TO/DO reasonable and specific?
Does the approach demonstrate a state-of-the-art understanding of
the work?
Does the list of tasks and deliverables differ from the SOW?
If so, do these differences appear justified?
Does the proposed schedule differ from the TO/DO/WA SOW?
If so, is the proposed schedule reasonable and acceptable?
Is the staffing plan reasonable in terms of qualifications and
distribution of responsibilities?
Is there a significant variance between the Contractor's estimated
hours and the Government estimate? If so, does the difference
appear justified?
Is the labor mix appropriate for the work? Is the mix of senior
and junior staff appropriate for the expected effort?
Is the planned use of.subcontractors appropriate? Does the Contractor
have an acceptable management plan for its subcontractors? Have
proposed subcontractors or consultants received CO consent?
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Is the Contractor proposing the use of GFP or CAP? Is the GFP/CAP ( )
necessary for effort? Is use of GFP/CAP approved in the contract
or is it necessary to get a FAR deviation?
Has the Contractor identified any issues which need to be resolved? ( )
COST PROPOSAL
Does the Cost Proposal contain the following elements?:
Labor hours by staff level or labor category ( )
Total labor costs ( )
Breakdown of other direct costs ( )
Total estimated costs and fee ( )
Is the total cost per professional/technical labor hour reasonable ( )
and broken down by task and subtask?
Are other direct costs (ODCS) reasonable and broken out in sufficient ( )
detail by task?
Is proposed travel reasonable? ( )
Are proposed training costs appropriate and reasonable? ( )
(CO prior approval is normally required)
Are other ODC elements reasonable? ( )
How does the Contractor's estimated cost compare to the IGE? If it exceeds ( )
it, does the increase appear justified? If it is less, is it an indication of
the Contractor's underestimation of the effort involved or a lack of
understanding of the requirement. NOTE: an underestimate can be as
large a problem since once the approved LOE and dollar amount are
reached, the WAM COR may be confronted with a choice of obtaining
additional funding or not getting a completed project.)
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Exercise 4-1
The instructor will assign roles of either the Government or the Contractor to the groups from
Exercise 3. The group designated as "Government" will be provided a copy of the IGCE
developed by the group designated "Contractor" as the cost estimate for the attached work plan.
The group will review the attached work plan, then conduct discussions/negotiations.
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Sample Contractor's Work Plan
XYZ, Inc.'s Proposed Work Plan
Contract No.
Task Order:
2001 National Symposium
1. BACKGROUND AND PURPOSE
XYZ understands the importance of indoor air quality and energy use for our nation's
children. We \yill assist the Agency with this task by putting on a spiffy conference.
2. TECHNICAL APPROACH
Task 1: Work Plan and Progress Reports
This is our workplan prepared in accordance with clause B.3 of the contract. Our period of
performance is as specified in the task order. We'll also write and submit monthly technical and
financial progress repoitsto as specified in the work assignment. To ensure excellent customer
services, our PM will meet weeldy with the COR to discuss progress and technical issues.
Task 2: Determine Location, Dates, and Logistical Arrangements
XYZ will determine the location and dates. We'll consider the following factors:
1. Close proximity to major airports, public transportation, and tourist attractions;
2. Meeting room space and hotel rooms to accommodate approximately 300 attendees;
3. Breakout session room space to accommodate five sessions simultaneously;
4. Space for conference registration, booths, and exhibits;
5. Availability of audio/visual equipment.
XYZ seek out hotels in states with excellent air quality and no reported indoor air quality
problems in their schools. We will also ensure the selected hotel is using energy saving
technologies. Once we locate the facility which meets all the aforementioned needs, we'll
contract with the hotel for conference services and provide a copy of the signed contract to the
COR.
Task 3: Attend Symposium Planning Meetings ^
XYZ will provide video conferencing services for all biweekly 2001 National
^Symposium planning meetings. Our policy and building specialists will attend these meetings to
£1 assist the COR with issues relating to indoor air quality and energy use in schools. Video tape
s.' ja copies of these meetings will be provided to the COR within one week of the meeting.
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Task 4: Communications, Outreach, and Product Development Support
XYZ is an industry leader in air quality research. We've worked with school districts,
state governments, and private industry in providing solutions to indoor air quality problems.
Our customers have always been pleased with our diligence and innovation in resolving their air
quality issues. We have gained national prominence in improving the air quality in public y
schools. Our building and lighting specialists are recognized by several professional /
organizations as leaders in their field. We have assisted many state governments with
developing indoor air quality standards for public schools. We're here to help you with these
issues. ^
Task 5: Invite Participants to Attend the 2001 Symposium
XYZ will create a master list of interested schools and health organization which includes
information received from the COR and a Google® search on the words "school district" and
"health organizations." From this list the COR will decide wRo to invite. XYZ will then
develop a data base listing all individuals and organizations, the dates they were contacted,
method of contact (e-mails, mass faxes, letters, or making phone calls), and their responses.
XYZ will submit this list with our monthly progress report.
Task 6: Provide Support for Symposium Break-Out Sessions
XYZ staff experts will prepare and present break out sessions
energy use issues. Planned break outs include:
a. What's New in Energy Policy 1
b. How to Develop an Energy-Savings Tracking Data Base
c. Lighting: Saving Energy, Saving Money \
d. Integrated Energy-Saving Systems )
e. Innovations in Heating and Cooling
Our policy research staff will review all speakers' materials to ensure it does not contradict any
EPA policy. XYZ will prepare speakers' audio-visual materials.
Task 7: Provide On-Site Support for the Symposium
XYZ expects the conference hotel staff will provide on-site support for the Symposium,
including organizing and running the registration table, and exhibition/booth support. If this is
not sufficient, we will subcontract with a local temp firm, as directed by the COR.
on relevant air quality and^
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4. SCHEDULE AND DELIVERABLES
Task Number
Deliverable
Due Date
Task 1:
Work Plan.
Progress Reports
April 1,2001
monthly
Task 2:
Copy of sign hotel contract f
/
Within 30 days after the approval of
the Work Plan.
Task 3:
Video tape of meetings /
Within one week following each
planning meeting.
Task 5:
Develop data ba^fsoffware^
List of audiences to be recruited.
Memo listing recruitment status and activities.
Within 60 days of start date
Within 10 days of data base
completion
Monthly
Task 6:
Draft agendas and ideas for support materials.
Provide support for breakout sessions.
July 3, 2001
Upon feedback from COR
3. BUDGET
(The cost estimates developed by the class will be used for this part of the exercise.)
4. PERSONNEL
Program Manager (PM)
Will develop workplan, progress reports, will attend all planning meetings.
Senior Policy Analyst (SPA)
Will review speaker's presentations for conformance with EPA policy and speak in a break out
session on "What's New in Energy Policy"
Senior Automated Data Processing (ADP) Manager (SAM)
Will develop recruitment data base software and speak in a break out session on "How to
Develop an Energy-Savings Tracking Data Base."
Senior Lighting Specialist (SLS)
Will speak in a break out session on "Lighting: Saving Energy, Saving Money."
Senior Energy Systems and Building Specialist (SESBS)
Will speak in a break out session on " Integrated Energy-Saving Systems."
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4. PERSONNEL (continued)
Building Systems Specialist
Will speak in a break out session on "Innovations in Heating and Cooling."
ADP Technical Support Specialist (ATSS)
Will input data into the recruitment data base.
Subcontractors: Temps for on-site support, as required by COR.
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s
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Chapter 5 - Monitoring the Contractor's Performance
1. Introduction
Performance monitoring is crucial in assuring that the Contractor understands the work
requirements and performs in a manner to produce quality results within the time required. Once
the task order, delivery order or work assignment has been issued, and any plan submitted by the
Contractor for performing the effort including staffing and costs (if applicable) is approved, it is
the COR's responsibility to monitor the Contractor's performance to ensure that EPA obtains a
quality product, on-time, and within cost. Before commencing monitoring activities, it is
essential that the COR be throughly familiar with the requirements of both the basic contract and
the tasking document.
The fundamental tenant is READ THE CONTRACT. Become thoroughly familiar with
the specific obligations of both the Contractor and the Government. The contract may require
EPA to provide property or data to the Contractor. If the property or data is not provided on
time, the Contractor may have an excuse for delaying performance or for a monetary claim
against the Government. CORs must be very careful to guard against such potential delays
caused by the Government, and should develop some type of schedule, coordinating with other
EPA offices, if appropriate, for the timely fulfillment of these obligations.
2. Technical Monitoring
The COR will use Contractor's approved plan as a guide to the technical approach and
staffing the Contractor will use. The COR's duties include making:
- A list of each of the major tasks and all associated deliverables.
- A list of all reporting requirements and deadlines; and,
- Any specific inspection requirements and duties of the Government. This list should be
kept up-to-date by the COR, and used as a tool for monitoring progress and determining the
extent of contract completion.
There are three areas in which the COR monitors the Contractor's performance:
A. Technical progress, quality of deliverables or services.
B. Schedule compliance (meeting due dates).
C. Staying within cost estimates in Work Plan
The broad category of technical monitoring includes:
- Giving technical direction OuUGOrfvJ^^-
- Avoiding vulnerabilities related to technical monitoring
- Reviewing deliverables
GwaJliKi ^
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- Conducting meetings
- Reviewing monthly progress reports.
- Evaluating Contractor performance
Cost monitoring and issues are covered in Chapter 7 - Invoice Review Process
3. Importance of Effective Technical Monitoring
It's very important for the COR to closely monitor the Contractor's efforts, no matter
what the pricing arrangement, in order to ensure the Government gets a quality product, on time,
and within budget. And although the Government has no ability to direct the Contractor when
the contract is FP, time is money - so even though the Contractor has to reperform the work if
done unsatisfactorily - target dates may be missed and that can have a very negative effect on
fulfilling the Government's mission. The COR still needs to monitor the Contractor to avoid
costly errors that cost time.
Note that under a fixed price contract where the statement of work is more definitive, if
the services do not conform to the contract requirements, the Government may request that the
Contractor reperform the services at no increase in the contract amount. Under cost
reimbursement contracts, if services do not conform with contract requirements, the Government
may require the Contractor to perform the services again in conformity with contract
requirements, for no additional fee\ however, the Government may be required to reimburse
some or all of the Contractor's costs for reperformance. Under Fixed Rate contracts or task
orders for services, whether the SOW is completion or LOE will determine the extent of the
Government's liability for reperformance costs.
When the Government starts with a less precise statement of work, the COR will be
responsible for providing guidance to the Contractor in performing the work-this is called
technical direction. A great deal of time and effort are required by the COR to guide the
Contractor's performance and effectively monitor the Contractor's progress.
4. What Constitutes Technical Direction?
a. Technical direction includes direction to the contractor which assists the contractor in
accomplishing the statement of work, comments on and approval of reports or other deliverables.
If technical direction involves any of the areas listed below, you will have crossed the line between
monitoring the contract into changing the contract. Only the CO has the authority to make
changes to the contract. The Technical Direction Clause within your contract states technical
direction must be within the scope of the contract, work assignment, delivery or task order. The
COR does not have the authority to issue technical direction which:
(1) Constitutes additional work outside the scope of the contract, task order, or
work assignment.
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(jD KY^ A fa
(2) Directly or indirectly changes the following:
(a) Pricing, cost or fee;
(b) Scope of the acquisition (contract, purchase order, work assignment,
delivery or task order, etc.);
(c) Delivery schedule or period of performance;
(d) Labor mix or level of effort; or
(e) Any terms or conditions of the acquisition.
(3) Authorizes Government-furnished property, or its disposition; or
(4) Directs the contractor to start work or issue stop work orders.
b. Exchanging information with the contractor is allowed; however, when doing this, all
Agency employees (not only CORs) must ensure they are not supervising or assigning tasks to
the contractor. Also, there is no prohibition against direct interaction with contractors on Agency
hotlines, computer support or library service contracts, or in discussions at professional meetings
that are not contract-related.
c. The technical direction clause specifies that technical direction will be issued in
writing or, if issued orally, confirmed in writing within five calendar days after issuance. Keep a
written record of all technical direction. If required under your contract, forward copies of
technical direction to the CO and the contract-level COR. Some contracts have a defined format
for technical direction. Check with your CO or contract-level COR to see if there's a designated
format under your contract. A sample format is provided in the appendix to this chapter.
d. Appropriate technical direction does not change the scope of work. For a guide in
deciding whether an action constitutes technical direction, ask yourself if the action changes what
was agreed upon in the approved work plan or statement of work. If it does, then it probably isn't
technical direction. If you are exceeding your authority, you risk personal liability for directing
unauthorized changes.
5. Technical Direction Contract Clause
The basic contract clause included in any Agency contract that authorizes technical
direction is included in the appendix. The clause defines what technical direction is, who is
authorized to give it, and what it cannot do. Included are comments in italics which are not part
of the clause.
6. How Do I Avoid Personal Services When Giving Technical Direction?
a. A personal services contract is characterized by the employer-employee
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relationship it creates between the Government and the contractor's personnel. An
employer-employee relationship under a service contract occurs when, as a result of the
contract's terms or the manner of its administration during performance, contractor personnel are
subject to the relatively continuous supervision and control of a Government officer or employee
(i.e, instruct, supervise, or control the contractor employees in how they perform their work).
b. Normally, the Government is required to obtain its employees by direct hire under
competitive appointment or other procedures required by the civil service laws. Obtaining
personal services by contract, rather than by direct hire, circumvents those laws unless Congress
has specifically authorized acquisition of the services by contract. Agencies cannot award
personal services contracts unless specifically authorized by statute to do so. EPA does not have
the statutory authority required to award personal service contracts. Before a contract is awarded,
the CO must make a written determination that the proposed contract is not for personal services.
c. The FAR 37.104 gives the following "descriptive elements" to be used as a guide in
assessing whether or not a contract is personal in nature:
(1) Performance on site;
(2) Principal tools and equipment furnished by the Government;
(3) Services are applied directly to the integral effort of agencies or an
organizational subpart in furtherance of the assigned function or mission;
(4) Comparable services, meeting comparable needs, are performed in the same or
similar agencies using civil service personnel, e.g., reviewing travel vouchers;
(5) The need for the type of service provided can reasonably be expected to last
beyond one year;
(6) The inherent nature of the service, or the manner in which it is provided,
reasonably requires, directly or indirectly, Government direction or supervision of contractor
employees in order to:
(a) Adequately protect the Government's interest;
(b) Retain control of the function involved;
(c) Retain full personal responsibility for the function supported in a duly
authorized Federal officer or employee.
d. All of these elements need not be present to have an improper personal service contract.
Additionally, having all of these elements present does not necessarily mean that an improper
personal services contract exists. The key element is whether the Government exercises continuous
supervision and control over the contractor personnel performing the contract. Each situation must
be reviewed and a determination made on a case-by-case basis.
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e. To ensure the Agency avoids personal service relationships with its contractors, the
Office of the Inspector General, the Office of Administration and Resources Management, and
members of the Resource Management Committee have agreed to require that each program office
conduct a Management Effectiveness Review (MER) on a biannual basis. Attached to this chapter
is the Personal Services Review Guide, a checklist used in the MER. Use this checklist as a guide
to ensure that you are managing your contracts properly.
7. EPA Guidance on the Use of Contractor Services
a. EPA has specific guidance on the proper use of contract services: EPA Order
1900.1 A, Use of Contractor Services to Avoid Improper Contractor Relationships. It is very
important that all Agency employees, not just CORs, comply with this order when interacting
with contractors. (The Order is attached to this chapter.) It is also available on the intranet at
http://epawww.epa. gov/oamintra/policv/eo 19011 a.pdf. The order directs Agency employees to
avoid becoming involved in the following areas:
(1) Routinely giving instructions and directions directly to contractor personnel.
(2) Intervening in a contractor's hiring, firing, or promoting of contractor staff.
This includes: (a) sitting in on an interview for potential contractor employees and offering
suggestions on whom to hire; (b) recommending, requesting, or refusing to have specific
contractor personnel assigned to work on a task order or work assignment; and (c) suggesting a
promotion, a bonus or other performance award for certain contractor personnel.
¦®* The COR may evaluate contract deliverables and services; however, the
COR cannot evaluate individual contractor employees.
(3) Having a contractor attend EPA functions, staff meetings, committees, or
activities, such as holiday parties, unless required for contract performance as documented in the
statement of work.
^ Contractors shall not attend meetings as the official representative of an
Agency Organization; however, contractors may serve in an advisory or
resource capacity.
(4) Paying for contractors to attend commercially available training courses, e.g.,
Microsoft Word. The contractor is responsible for providing competent staff to meet the
expertise required by the contract. The only exception to paying for training is for specialized,
Agency-specific training which is not obtainable from a commercial source. Prior CO approval
is required in all cases.
(5) Requesting contractors to purchase supplies or services for use by EPA
employees that are not required by terms in the contract.
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(6) Creating a situation where one prime contractor is directing another prime
contractor. (Technical direction must come from the cognizant COR.)
(7) Directing a prime contractor to subcontract with a particular firm or giving
technical direction directly to a subcontractor. (Technical direction to a subcontractor must come
from the prime contractor.)
8. Who is Authorized to Give Technical Direction?
a. Only the person appointed as a COR has authority to give technical direction. Technical
direction can only be given by the cognizant COR to the contractor's point(s) of contact and not
to individual contractor employees. The contractor's point(s) of contact will be listed in the
contract, work assignment, delivery/task order, or approved work plan. Other EPA employees,
including the COR's supervisor, are not authorized to give technical direction.
b. Only the contract CO can appoint a COR and the COR's authority is not redelegable. In
other words, the COR cannot authorize another person to give technical direction or perform other
COR functions.
c. In the case of subcontractors under Agency contracts, only the prime contractor can give
them technical direction. Because there is no legal relationship between the subcontractor and the
government (i.e., "privity of contract"), the COR cannot give technical direction to a subcontractor.
"s* Senior Environmental Employment (SEE) employees are not EPA employees or
contractors, but grantees. Agency employees may give daily direction to SEE
employees, such as telling them which tasks to perform, but cannot supervise
them, including enrolling, disciplining, or terminating them. Additionally, SEE
employees cannot perform any inherently governmental functions, such as
managing contracts, i.e., serving as a COR.
9. Unauthorized Commitments
a. An unauthorized commitment is an inappropriate contract action, taken by an EPA
employee who does not have CO authority, which commits the Government for the expenditure
of funds in exchange for goods or services. Unauthorized commitments constitute a violation of
procurement regulations and may result in adverse actions against the individual involved and
may contribute to the waste and abuse of Agency resources. Both Agency and Federal
Government policy strongly discourage unauthorized commitments. Actions that contractually
bind the Agency must be made by officials with appropriate contracting authority. Examples of
unauthorized commitment actions include:
(1) Ordering supplies or services by an individual without contracting authority,
(2) Unauthorized direction of work through assignment of orders or tasks;
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(3) Unauthorized addition of new work;
(4) Unauthorized direction of contractors to subcontract with particular firms; or
(5) Any other unauthorized direction which changes the terms and conditions of
the contract.
b. In certain instances, inappropriate technical direction may constitute an unauthorized
commitment. To create an unauthorized commitment situation means that a COR or other
Federal employee gave direction to the Contractor that the individual had no authority to give.
c. "Ratification" is the process of retroactively approving an unauthorized commitment
by an official in the Office of Acquisition Management (OAM) or regional contracting office
with the authority to do so. Ratification actions may be performed by warranted Service Center
Managers within OAM or by regional contracting officers who have been granted the authority.
d. It should be noted that not all unauthorized commitments can be ratified. Basically,
the unauthorized commitment has to be an action that would have been proper had a CO
performed it in order for it to be ratified. Section 1.602-3(c) of the Federal Acquisition
Regulation and Chapter 13 of the Contracts Management Manual sets forth standards which must
be met before a ratification can occur. These conditions include the following:
(1) Supplies or services have been provided to and accepted by the Government,
or the Government otherwise has obtained or will obtain a benefit resulting from performance of
the unauthorized commitment;
(2) The resulting contract would otherwise have been proper if made by an
appropriate contracting officer;
(3) The contracting officer reviewing the unauthorized commitment determines the
price to be fair and reasonable and recommends payment;
(4) Funds are available and were available at the time the unauthorized
commitment was made.
For example, EPA has no authority to procure personal services. Such an action could not be
ratified and the person responsible may be personally liable for any costs.
d. The program office is responsible for notifying the ratifying official and following the
procedures outlined in the EPA Acquisition Regulation 1501.602-3 and Chapter 12 of the
Contracts Management Manual, available on the Agency intranet at
http://epawww.epa.gov/oamintra/policv/cmm.pdf
e. In addition to personal liability, individuals responsible for unauthorized commitments
may be prohibited from serving as a COR on any Agency contract. Individuals may face
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disciplinary action, as set forth in the Agency's Conduct and Discipline Manual (EPA Order
3120.1), ranging from an oral reprimand to removal based on the severity of the offense. The
ratifying official may inform the Inspector General of the action by memorandum through the
Director of OAM.
For more information on unauthorized commitments, see FAR 1.602-3,
EPAAR 1501.602-3, and CMM Chapter 12.
10. Subcontracting
A sizeable portion of many EPA contacts is performed by subcontractors. This is often
necessary for the successful accomplishment of the program mission. The existence of
subcontracts allows the federal dollar to be spread out over many more firms than would be the
case if prime contractors performed the total effort. Other benefits arise from the fact that the
combined expertise of two or more firms may offer a better quality product or service to the
Government than that of a single firm. But, because it is often risky to rely wholly on the prime
contractor's assurance that subcontracted work will satisfy all Government requirements, there
are contractual controls in place.
The prime contractor is selected in part for its management abilities, which includes the
right to manage the contract in every aspect. The Government cannot direct the contractor to
subcontract any part of the work. The Government may also not, under any circumstance, direct
the prime contractor to subcontract with a specific firm. Even a suggestion of a particular firm
from a list of firms would be improper. These decisions are entirely at the discretion of the
prime contractor, who has overall responsibility for contract performance. Nonetheless, in
certain situations, the Contracting Officer must consent to the use of certain types of
subcontracts.
Consent to subcontract is not required under firm-fixed-price contracts, as the
Government's interest is presumably adequately protected in this instance by the type of contract
because of the fixed price. However, under all other types of prime contracts used at EPA,
subcontracts require the consent of the Contracting Officer before the prime contractor may enter
into a subcontract agreement.
The Contracting Officer considers such factors as technical need for services, compliance
with the prime contract's requirements for subcontracting with labor surplus area or small
business concerns, adequacy of the competition obtained, responsibility of the proposed
subcontractor, proposed type of subcontract, technical requirements proposed, and adequacy of
cost or price analysis performed. The COR will usually be requested to comment on the
technical need for the supplies or services, the reasonableness of the subcontract estimate, the
capabilities fo the proposed subcontractor, and in the case of a request to acquire property, the
availability of the item within EPA. Consent must be in the form of a written modification to the
contract or a letter to the prime contractor, and must be signed by the Contracting Officer.
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11. Directed Subcontracting
A. Policy - To the maximum extent practicable, the prime Contractor should compete
subcontracts. Agency employees must not interfere in this process by directing the prime on when
or to whom it should subcontract. Directing the prime Contractor to use a specific Subcontractor or
directing that any portion of the contract work should be performed by subcontracting is improper.
CORs must not draft specifications or SOWs which contain unnecessary restrictions
intended to direct or force the prime to use a particular Subcontractor. The FAR requires us to
promote full and open competition and to only include restrictive conditions to the extent
necessary to satisfy the legitimate needs of the Government. Violation of this regulation can
result in disciplinary action against the employee responsible.
Before awarding a subcontract, prime Contractors must obtain the consent of the CO.
The CO reviews the Contractor's request and supporting data and considers a variety of factors
as listed in FAR 44.202-2 before giving consent to subcontract. The COR also reviews the
Contractor's request and provides comments and recommendations to the CO:
1. On the technical need and appropriateness of the supplies or services.
2. The reasonableness of the subcontract estimate in terms of the level of effort, and
types and quantities of proposed other direct costs.
3. Location, duration, number of travelers and purpose of proposed travel.
4. Skill level, labor mix, and direct labor hours to be expended.
5. The capabilities of the proposed Subcontractor. The COR must document the file
when reviewing the prime Contractor's request to subcontract.
A "Team Subcontractor" is a Subcontractor that was either approved by the CO at
the time of contract award or later became part of the team by specific written CO
consent. Once consented to, prime Contractors need no further approval to use a
team Subcontractor as long as it is within the task areas identified for that
Subcontractor. The CO consent often puts a dollar or hour ceiling per each team
Subcontractor. Some contracts may also have specific work plan approval
procedures involving Subcontractors which must be followed. There are other
FAR and contract restrictions on the use of Subcontractors. The COR must read
the contract to ascertain the proper procedures and ask the CO if the COR has any
questions about the use of Subcontractors.
B. Interaction with Subcontractors
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On many Agency contracts the Contractor (the "prime Contractor") will subcontract work
to one or more Subcontractors or Consultants. When administering contracts involving
Subcontractors it is important to remember there is no legal relationship ("privity of contract")
between the Agency and Subcontractors. Additional information on the proper use of
Subcontractors can be found in the Contracts Management Manual. Specifically it forbids:
1. Directing the prime Contractor to use a certain Subcontractor or Consultant. The mere
suggestion of a firm is improper.
2. Directing that any portion of the work should be performed by subcontracting, rather
than by the prime Contractor.
3. Providing technical direction to a Subcontractor without the knowledge of the prime
Contractor.
4. Directly monitoring a Subcontractor's technical performance and financial
expenditures to the exclusion of the prime Contractor. Any technical or financial subcontract
problem must be brought to the prime Contractor's attention and documented in the contract file.
The prime Contractor is responsible for resolving these problems.
5. Directing the Contractor to subcontract beyond the available appropriation (e.g., if
funds expire October 1st, directing the Contractor to work until January 1st) or at the end of the
contract period of performance (e.g., if the contract ends September 30th, directing the Contractor
to work until December 31st).
12. Reviewing Deliverables
One of the most crucial duties of a COR is the review of deliverables. When performing
this function, the COR must remember to:
A. Perform reviews within contract time frames. In some contracts a deliverable must be
reviewed and accepted or rejected within two weeks of receipt. A COR needs to check the
contract for specific standards. Acceptance may be implied if the time frame has been exceeded.
Also, it is important to ensure that deliverables supporting key milestones are reviewed to
prevent cumulative delays.
B. Perform detailed reviews, providing specific feedback to the Contractor on revisions
required. Contractors are motivated to produce a quality product if the Contractor knows that
EPA cares enough about the item to perform a thorough review of it.
C. Seek other technical experts to review the deliverable, as necessary. Keep in mind
that requesting revisions constitute technical direction and can only be done by the COR, so all
deliverable comments must come through the COR before going to the Contractor.
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D. If specified in the contract, TO, DO or WA, a peer review of a deliverable may be
conducted. To understand the issues involved in the use of peer review, a COR can read ORD's
Peer Review Handbook at wwvv.eDa.gov/ordntrnt/ORD/spc/Drhandbk.
E. Always document review of deliverables using either a deliverable review form, a
memorandum to the Contractor providing comments, or annotation of the draft. This is
particularly important if you are involved in sensitive/vulnerable activities as discussed in
module 3.
NOTE: A Checklist for review of deliverables is in the Appendix to this Chapter
13. Reviewing Performance
The importance of timely and specific feedback - Timely and specific feedback can't be
emphasized enough when the COR is working with a FR or CR LOE type of SOW. This type of
SOW is imprecise and is highly dependent on technical direction. With a CR type of SOW, the
Government agrees to pay the Contractor for all of its allowable, allocable and reasonable costs,
and delay in providing feedback can cost the Government not only in real dollars but also time,
which has a monetary consequence as well. In a FR pricing arrangement, the Government is
paying average hourly rates by labor category. Inappropriate use of a labor category or the use of
less experienced individuals within a labor category allows the Contractor to increase profits
while being reimbursed for all of its indirect costs for each direct labor hour used. COR
oversight is critical. It is also why this type of pricing arrangement in a contract is the least
preferable. Even with a FP effort requires timely review. Delay by the Government can mean
the Contractor has a legitimate request for time extensions or adjustments in the fixed price.
Ximely. feedback will support correction of a problem before it becomes serious. Specific
feedback, Le., addressing particular aspects of a deliverable or a service which are not acceptable,
will help the Contractor focus on the areas that need improvement. Additionally, the COR
should:
A. Provide regular, direct feedback throughout the course of the effort - the COR should
periodically offer comments on the Contractor's work as the work progresses. Regular progress
meetings and telephone discussions with the Contractor are a good means to do this. Regular
feedback can help ensure the quality of a deliverable by preventing misdirected efforts.
For example, even with a FP DO for a complex end product, a Contractor can
head off in the wrong direction. COR review of the monthly progress reports can avert a delay
and claim for price adjustment. Don't let problems fester!
B. Accentuate the positive. - Providing positive feedback on a deliverable or service will
provide a strong motivating force to the Contractor to sustain a high quality effort. Even if there
are problems, by approaching the "good news" first, it makes any "bad news" easier to handle.
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C. Focus feedback on the quality and timeliness of services and deliverables, as opposed
to the performance of individual Contractor employees. Concentrating on individual staff
performance may create the appearance of a personal services relationship. However, point out
to the Contractor instances where he is not following the staffing plan set forth in the work plan,
e.g., if he is using highly skilled employees on a routine job or vice versa.
D. Be objective, fair, and professional - Pinpoint the cause of the problem without finger
pointing or getting sidetracked. Consider all viewpoints of the problem, potential solutions, and
work toward developing a reasonable plan of action.
E. Know when to get help - for technical issues you are not familiar with, invite an
individual with technical expertise to participate in a meeting with the Contractor to discuss
performance. Although Chapter 7 of the Contracts Management Manual requires the TO, DO or
COR to be technically proficient in the work the Contractor is performing (having sufficient
knowledge and experience to review deliverables, understand the labor categories involved in the
work and the amount of hours needed to complete the work), there will be times when the COR
needs the assistance of another individual.
F. Notify the contract COR or the CO, as appropriate. The COR should always notify
the CO if performance problems will impact the schedule or funding.
G. Document performance problems - identify the problem(s), the proposed remedy,
schedule impact, cost impact, and discussions with the Contractor.
H. Understand the contractual limits - Under LOE SOWs, the Contractor guarantees
only "best efforts," and the Government pays for reperformance. If additional funds are not
available, it may be necessary for the CO to negotiate an amendment/modification to the SOW
and the schedule. The COR provides essential technical advise and analysis to-the CO, but, the
CO is the only individual with authority to make changes to a contract, WA, DO or TO.
Subcontractor Performance - Discuss subcontractor performance with the prime
Contractor. Remember the prime is responsible for oversight of its subcontractors. Feedback on
subcontractor performance must be routed to the subcontractor Project Manager through the
prime Contractor. If a subcontractor presents a problem directly to EPA, the COR should inform
the subcontractor that the COR cannot mediate the problem. The subcontractor needs to seek a
solution with the prime. However, the COR can also raise the issue with the prime, without
directing the prime to a solution, by suggesting that the two parties meet to resolve their
differences.
Prime Contractors and their subcontractors occasionally have disputes on work effort or
product. This can involve:
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A. Subcontractors receiving less work than expected or indicated in the prime
Contractor's proposal in response to the RFP.
B. Subcontractors not being paid promptly by the prime Contractor.
C. Products prepared by the subcontractor being delayed because of extensive review
time by the prime Contractor.
When there are disputes between a prime Contractor and its subcontractor, EPA cannot
mediate. EPA has no privity of contract with a subcontractor, it cannot mediate such disputes.
Privity of contract refers to the legal contractual relationship between parties. There is a
contractual relationship between Government and the prime Contractor and another, separate one
between the prime Contractor and a subcontractor, but no legal, binding agreement between the
Government and any subcontractor. In a disagreement between a prime and its subcontractor,
some actions a COR can take are:
A. CORs can review the management hours being applied by a prime Contractor to work
performed primarily by a subcontractor. While it is difficult to provide a rule of thumb, the COR
should assess the reasonableness of the management hours in terms of their specific purpose,
e.g.. administrative processing of vouchers and work plans, substantive review of products, etc.
B. CORs can review the causes of delays in delivery of work products with the prime
Contractor. If delays are due to the time needed by the prime Contractor for review, the COR
can discuss how to accelerate this process in order to meet EPA's needs.
C. CORs can examine how the prime Contractor utilizing staffing. If the majority or all
of the work is being performed by a subcontractor and if the key personnel for the subcontractor
are not being used, this should be flagged for review.
The prime Contractor is responsible for business decisions on whether to subcontract the
work or to keep the work in-house. However, it's the responsibility of the COR to review the
proposed technical and staffing plan. If the prime Contractor is proposing to use staff without
the experience or educational requirements of the Government, the COR can emphasize the
importance to the prime of providing personnel with the required qualifications to accomplish the
work. While EPA cannot direct the prime Contractor who to use on a particular project, it can
insist upon reviewing the qualifications of personnel proposed for the work.
14. Reviewing the Monthly Progress Report
Almost all EPA contracts require that Contractors submit a combined monthly
technical/financial progress report with the monthly invoice. The MPR serves the following
purposes:
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- Assists the COR in monitoring technical progress.
- Contract Type
a. For FP contracts, it assists the COR in monitoring the physical progress by comparing
the costs being invoiced against the overall milestones projected by the Contractor and fixed
price of the effort.
b. For CR contracts, it assists the COR in reviewing invoices and monitoring the
financial status of the project by comparing hours and costs against the technical activity, i.e., a
"snap shot" of the work in progress.
c. For FR contracts, it assists the COR in monitoring the hours used by labor category
and comparing it against the technical activity and costs being invoiced.
The MPR supports an audit trail of work performed. CORs need to remember that the
MPR provides the Contractor's assessment of their performance. Changes to the content of the
MPR (e.g.. requesting additional information), due date, or frequency (e.g.. semimonthly) must
be done by the CO through a contract modification covering all WAs/DOs/TOs . The benefit of
the more frequ'ent or additional information provided must be weighed against the cost to provide
the information and the time to review it.
The information required in the MPR will vary depending on the contract type. The
standard clauses for MPRs are included at the end of this module. The COR needs to read the
contract to determine what the requirements are for her/his specific contract and use his/her
knowledge and technical expertise to analyze and verify the information contained in the report.
All the information required by the MPR clause must be in the monthly report. CORs need to
pay particular attention to the following:
A. Estimated percentage of work completed during the reporting period.
Note how this number is computed. Is the reported progress reasonable and is it
supported by the MPR narrative? Is the percentage of completion commensurate with the costs
incurred on the work assignment? If 25% of the work assignment budget has been spent, has
25% of the work been completed? A significant variance in this area warrants further
investigation.
B. Any difficulties encountered during that time and remedial actions taken.
The Contractor should report problems which impact timely and efficient performance.
1. CORs should be especially aware of any indication in the report of Government
actions or delays that the Contractor states is inhibiting its progress, such as when the Contractor
is waiting for data or review of a draft deliverable from the COR.
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2. If the Contractor has run into a problem, the Contractor needs to state how it
plans to handle it. The report should state what remedial actions have been taken. The COR
must evaluate the proposed remedial plan of actions and ensure it's acceptable.
3. The COR needs to note whether problems are going to impact the delivery
schedule, and, if so, then the CO must be notified and the COR should make a recommendation
on whether the TO or DO needs to be modified or the WA amended.
4. If the COR doesn't recommend an adjustment, the COR needs to provide ideas
for other courses of action and a negotiation position to the CO. The COR should consider what
consideration would be acceptable in exchange for the adjustment.
C. Anticipated activity with a schedule of deliverables for the subsequent reporting
period.
The COR should always compare the progress with the Contractor's projected
milestones.
1. In some cases, the Contractor may not want to be the "bearer of bad tidings."
A Contractor may avoid or gloss over problems areas.
2. The Contractor may have a plan for catching up and meeting the delivery
schedule, but the COR needs to query the Contractor when there are discrepancies between
actual progress and projected milestones.
3. The COR needs to be aware of what's not addressed in the MPR as well as
what is.
The MPR not only addresses activity completed, but also anticipated activity for
upcoming months and a schedule of deliverables for the subsequent reporting period. Did the
Contractor submit the deliverables required for this period? If so, the COR needs to know what
their review status is. If not, any changes to deliverable due dates in the TO, DO or WA require
a formal modification/amendment by the CO.
D. Outstanding actions awaiting CO authorization, such as work plan,
subcontractor/consultant consents, or overtime, approvals.
1. In some cases the Contractor cannot proceed until the CO formally approves
the action, such as request for consent to a proposed subcontractor. This, in turn, may affect the
Contractor's ability to meet due dates. The COR needs to read this section carefully and follow-
up with the responsible party on any pending actions.
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2. Labor Use (applicable for commercial non-supply items) - Compare this
information to the negotiated work or staffing plan. Especially if there was a difference between
the original submission by the Contractor and the final agreed upon labor mix. The COR needs
to ensure that the Contractor is using the appropriate skill mix to accomplish the work, or, if
there is a disparity between the agreed upon mix and the actual usage, the COR needs to question
the Contractor's PM about the reasons for the different usage.
E. Financial status-amount claimed for current period.
The COR should evaluate the "burn rate" or usage of the labor hours compared
with the technical progress reported. The number of hours expended need to correlate with the
amount of work completed. In an LOE SOW, the issue is whether there are enough labor hours
remaining to accomplished the activities planned for the next month, until the end of the period
of performance, or to accomplish all of the tasks in the SOW. Any adjustment to the labor hours
requires CO action.
NOTE: Many Agency contracts have a Key Personnel Clause which lists labor
categories and individuals who have been determined to be "key" to the performance of the
contract. If the Contractor wants to replace a person designated in the key personnel clause, then
the Contractor must provide a detailed explanation of the circumstances necessitating the
proposed substitutions, provide resumes for the proposed substitutes, and any additional
information requested by the CO. Proposed substitutes must have comparable qualifications to
those of the persons being replaced. The contract COR and the CO have the joint primary
responsibility for reviewing and recommending approval or disapproval of changes to key
personnel. CO approval, through a contract modification, is required before the Contractor can
make substitutions to the key personnel.
While it is the Contractor's responsibility to notify the CO of changes, the COR should
review the progress reports and monitor any apparent staff changes to ensure that the
requirements for key personnel are met. The contract COR needs to provide the COR with
access to the list of the names of all key personnel on the contract.
F. A cumulative display of cost-type information including:
1. Amount shown on workplan or latest amendment,
2. Amount currently claimed,
3. Amount suspended,
4. Amount disallowed,
5. Remaining approved amount.
G. Labor Hours including:
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1. A list of employees, their labor categories, and the number of hours worked for
the reporting period.
2. I. For the current reporting period, display the expended direct labor hours (by
EPA contract labor hour category and the total loaded direct labor hours.
3. For the cumulative reporting period and cumulative contract period display:
the negotiated and expended direct labor hours (by EPA contract labor hour category) and the
total loaded direct labor costs.
4. Display the estimated direct labor hours and costs to be expended during the
next reporting period.
5. Display the estimates of remaining direct labor hours and costs required to
complete the WA/DO/TO.
H. Unbilled allowable costs. Display the total costs incurred but unbilled for the current
reporting period and cumulative for the WA/DO/TO (e.g., subcontract costs for CR or FR
contracts).
I. Average cost per labor hour. For the current period, compare the actual total cost per
hour of the approved workplans.
J. A list of deliverables for each WA/DO/TO during the reporting period.
It is good practice for a COR to annotate the Contractor's MPR, not only to
indicate the exercise of contract management oversight, but also to indicate questions that arise
during the review. The Contractor's response to the inquiries should also be listed. These
annotations support a complete audit trail. This is especially important if there are questions on
whether the Contractor exceeded the scope of the SOW.
15. Meetings with the Contractor and Site Visits to the Contractor's Facility/Office
Meetings and site visits can be used as a tool to monitor the Contractor's performance. .
How to use this tool will depend on the nature of the work, the location of the Contractor, the •
quality of performance, the extent of any problems and what type of contract and SOW is
involved. The COR needs to keep in mind that FP efforts allow virtually no flexibility regarding
technical direction, and that in a performance-based SOW, the Contractor is measured on
meeting the objectives within certain stated measurements, and not on the method (the how) the
Contractor used to get there.
Periodic meetings or telephone discussions with the Contractor PM may help the COR
more effectively monitor the Contractor's progress.
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A. For example, on a complex cost-reimbursement task order covering several months,
the COR may request verbal progress reports in addition to written progress reports. This
requirement would be specified in the task order statement of work.
B. If not overused or mismanaged, meetings can be excellent method of resolving issues
impacting a variety of people. Meetings could be in person or by phone.
C. The COR should generally inform the contract COR of meetings with the Contractor,
so the contract COR can attend if desired.
D. Meetings to discuss particular issues or problem areas should always be attended by
the contract COR. Other suggestions for the COR in conducting progress meetings with
Contractors include:
1. Develop an agenda. Know what you want to accomplish.
2. If there are significant issues to discuss or resolve, notify the Contractor PM in
advance so he or she can be in a better position to respond.
For off-site contracts the COR may conduct site visits to the Contractor's office to
examine the facility (if applicable) and discuss technical issues with the Contractor's PM and
technical staff. This can also be a good opportunity to perform a review of any Government-
furnished property to ensure it is properly maintained and secured.
Lack of travel funds may make site visits difficult. Also, it would not be practical for
every COR on a large contract to visit the Contractor's site. Any decision to perform an off-site
visit should be coordinated with the contract COR.
Important Issues a COR Needs to Consider When Meeting with a Contractor
A. Meetings cost money. Unless the contract has included preplanned meetings with the
Contractor, they should be held to a minimum and should focus on problem resolution.
B. CORs need to be aware of the costs incurred by the Contractor when unscheduled
meetings are requested.
- In fixed price contracts, the Contractor may balk at attending meetings that
weren't priced out and included in the SOW of the contract.
- In cost-type contracts, the Government will have to pay the costs associated
with the meetings, including time for travel to and from the meeting, mileage reimbursement,
and parking costs to name several specific costs that routinely are involved.
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Required Documentation of Meetings with Contractors
A. Whether meeting at the Agency, at a Contractor's facility, or using teleconferencing,
all meetings must be documented. EPA Order 1900.1A calls for the preparation of such
documentation.
B. The absence of such records has been noted in OIG audits. Meeting minutes
generally document:
1. Attendees
2. Situation, problems, or reason for calling a meeting
3. Discussions
4. Recommendations or conclusions
5. Action items and who will handle them.
C. Minutes can be written by anyone attending the meeting.
1. Although it might seem to make the COR's job easier, COR's need to keep in
mind that having the contractor perform this function can cause contract costs to mount and
mean less money and hours for the central purpose of the WA, TO or DO.
2. If the Contractor performs the function, the COR needs to read them very
carefully prior to approving or signing off on the minutes.
3. Copies of the meeting minutes should be provided to all attendees and included
in the contract file.
Note: A Sample Meeting Report is in the Appendix to this Chapter
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Appendix to Chapter 5
Document Page Number
1. Sample Format for Technical Direction 5-21
2. Personal Services Review Guide 5- 22
3. EPA Order 1900.1a, Use of Contractor Services to Avoid 5-25
Improper Contractor Relationships
4. Checklist to Avoid the Existence or Appearance of Personal Services,
Inherent Government Functions, or Sensitive/Vulnerable Services 5-33
5. Technical Direction Clause 5-36
6. Monthly Progress Report Clause 5-37
7. Review of Deliverables Checklist 5-40
8. Meeting Documentation Memorandum 5-41
9. Student Exercise No. 5-1 5-42
10 Student Exercise No. 5-2 5-43
11. Student Exercise No. 5-3 5-44
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Environmental Protection Agency
TECHNICAL DIRECTION
Contract No.
Contractor:
Work Assignment:
Project Officer:,
Phone:
THIS TECHNICAL DIRECTIVE DOCUMENT REFERENCES
Meeting
V./E-mail Message
Phone conversation
Memo or deliverable ¦
If so, when_
with whom
Name of Deliverable:
Direction to Contractor:
I CERTIFY THAT THIS TECHNICAL DIRECTIVE DOES NOT REQUEST SERVICES THAT ARE INHERENTLY
GOVERNMENTAL FUNCTIONS AND THAT IT DOES NOT ALTER THE (1) STATEMENT OF WORK, (2) LEVEL OF
EFFORT, (3) COST OF PERFORMING THE AUTHORIZED WORK, (4) NUMBER OF DELIVERABLES, OR (5) THE DUE
DATES OF DELIVERABLES FOR THE ABOVE REFERENCED WORK ASSIGNMENT.
COR Signature
Date
Original to Contractor
cc: WAM file Project Officer Contracting Officer
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PERSONAL SERVICES REVIEW GUIDE
A. PURPOSE
The purpose of this review is to objectively evaluate: 1) whether or not any personal service
activity is occurring under Agency contracts, and 2) whether or not conditions exist that may
create personal service vulnerabilities.
B. SCOPE
A thorough review of contracts most vulnerable to personal services situations would consist
minimally of the following steps: 1) review of contract statement of work, 2) review of
applicable work assignment or delivery order statements of work, 3) interviews with contractor
and program or regional staff, 4) interviews with contractor and program management personnel,
5) inspection and observation of on-site operation, 6) verification of adherence with Agency
procedures (co-location of employees, proper use of badges, use of Agency equipment, etc.), and
7) identification of internal management controls strengths and weaknesses.
C. CRITERIA
The following are examples of the types of questions and issues that should be explored:
Physical Space
1. Is the contractor's office space clearly marked by a sign indicating the area is occupied by
a contractor and include the contractor's name?
2. Is the contractor's on-site space physically separated from Agency space?
3. Has the Agency given the contractor staff access to Agency fax machines, copiers,
computers, or file rooms? If so, has the Agency properly set schedules and priorities for
the use of any common equipment by both parties? Is this specified in the contract? Has
the Agency given the contractor access to any property and/or equipment not specified in
the contract?
4. Do the contractor staff routinely wear identification badges which clearly indicate they
are contractors?
5. Does contractor staff clearly identify themselves as contractors when answering their
telephones (or on voice mail greetings)? (Make phone calls to check this.)
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6. Are subcontractors physically located on-site? If so, is their space separate from Agency
space, etc.? Do Agency personnel work directly with subcontractors?
Working Relationships
7. Do Agency employees instruct or direct contractor staff to perform tasks?
8. Has anyone in the Agency recommended, or refused to have, specific contractor staff
assigned to work?
9. Do Agency employees instruct the contractor without putting technical direction in
writing within five days?
10. Has any Agency employee suggested a promotion or bonus for contractor staff, or
provided input on the job performance of individual contractor staff? Has any Agency
employee commended in writing any contractor staff specifically?
11. Has any Agency employee participated in the hiring or firing of individual contractor
staff, including sitting in an interview for potential contractor hires, or suggesting who to
hire?
12. Has any Agency employee invited contractors to attend Agency meetings not related to
the contact work (staff meetings, holiday parties, etc.)?
13. Has any Agency employee entered a contractor's work area when no contractor
supervisor is present? If so, for what reasons? Has any Agency employee (project officer,
work assignment manager, or any staff) directly requested contractor personnel to
conduct work not otherwise required by the contract?
14. Has any contractor employee participated as a member of an Agency committee planning
an Agency award ceremony?
15. Has any Agency employee acted to resolve a personnel complaint from a contractor
employee?
16. Has any Agency employee assigned tasks to, or prepared work schedules for, contractor
employees, including approving when a contractor employee can go on leave?
17. Has the Agency retained the right to supervise the work of contractor staff, or reserved
the right to control the number of people employed and duties of individual contractor
employees?
18. Are contractor staff used interchangeably with Agency staff to perform the same
functions?
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Are contractor personnel integrated into the Agency's organizational structure (mixed
teams)?
Are all work assignment managers, delivery order project officers, etc., properly trained?
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Approval Date: 4/14/94
EPA ORDER 1900.1A
USE OF CONTRACTOR SERVICES TO AVOID IMPROPER
CONTRACTOR RELATIONSHIPS
1. PURPOSE. This Order is designed to assist Agency employees to avoid improper contractor
relationships in performing contract management activities.
2. BACKGROUND. Past contract management problems identified by the Office of the
Inspector General and the General Accounting Office have indicated that Agency contracts were
not always administered in accordance with applicable laws, regulations, and policies. They also
identified cases in which insufficient controls were established to preclude fraud, waste and
abuse, and conflicts of interest, and to safeguard Agency assets. The Federal Acquisition
Regulation (FAR) prohibits personal services contracts unless specifically authorized by statute.
Personal services contracts circumvent civil service laws, which require the government to obtain
its employees by direct hire in accordance with Office of Management and Budget ceilings, and
inappropriately augment Agency staff without proper legislative review.
3. RESPONSIBILITIES. Contracting Officers (COs), Project Officers (POs), Delivery Order
Officers (DOOs), Delivery Order Project Officers (DOPOs), Work Assignment Managers
(WAMs), Remedial Project Managers (RPMs), On-Scene Coordinators (OSCs), Task Managers
(TMs), and all other EPA employees are responsible for ensuring that personal services
relationships between Government employees and contractor personnel are avoided.
4. DEFINITION. A personal services contract is a contract which, by its terms or as
administered, results in contractor personnel being subject to relatively continuous supervision
and direct control by a Government official or employee. A personal services contract is
characterized by the employer-employee relationship it creates between the Government and the
contractor's personnel. These contracts make the contractor personnel appear, in effect, to be
Government employees. Attached is a list of examples of personal services, which are provided
to further clarify some of these prohibited activities. (Appendix A)
5. ASSESSING THE NATURE OF A CONTRACT. FAR Part 37.104(d) provides the following
descriptive elements to be used as a guide in assessing whether a proposed contract is personal in
nature. These elements can also be used as a guide to determine if the way in which a contract is
administered creates a personal services contract. An improper contract relationship may exist if:
a. Contractor performance is done on site.
b. Contractor's principal tools and equipment are furnished by the Government.
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c. Contractor's services are applied directly to the integral effort of agencies or an
organizational subpart in furtherance of an assigned function or mission.
d. Comparable services, meeting comparable needs, are performed in the same or similar
agencies using civil service personnel.
e. The need for the type of service provided by the contractor can reasonably be expected
to last beyond one year.
f. The inherent nature of the service or the manner in which it is provided reasonably
requires, directly or indirectly, Government direction or supervision of contractor employees in
order to-
(1) Adequately protect the Government's interest;
(2) Retain control of the function involved; or
(3) Retain full personal responsibility for the function in a duly authorized Federal
officer or employee.
Note: all of these elements need not be present to have an improper personal services contract.
Additionally, having all of these elements present does not necessarily mean that an improper
personal services contract exists. The key element is whether the Government exercises
continuous supervision and control over the contractor personnel performing the contract. Each
situation must be reviewed and a determination made on a case-by-case basis.
As in any contract situation, Agency employees should contact the CO for advice and guidance
whenever they have questions regarding relationships with contractor personnel. Agency
employees may also contact the Contracts Law Branch, Office of General Counsel (OGC) for
further guidance. Agency employees who believe that a personal services contract exists
should immediately notify the CO.
6. PRINCIPLES FOR MANAGING A CONTRACT.
a. The CO is responsible for determining, prior to award, that the contract does not
involve .the procurement of personal services. Even though supervision by Government
employees is not directly required by the terms of the contract, a personal services contract may
evolve through improper contract management. Agency employees who believe that, through
improper contract management, a contract has evolved into a personal services contract should
immediately notify the CO. The CO will investigate these situations and take appropriate action
to ensure that contracts are managed to maintain proper contractual relationships.
b. Technical management of a contractor's performance generally relates to the manner in
which authorized EPA employees provide work direction to the contractor. Exchange of
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information of a technical nature is not prohibited. Appropriate technical direction is the
clarification of ambiguous technical requirements to ensure efficient and effective contractor
performance. Proper technical direction is not supervision or assignment of tasks to contractor
personnel. In managing the contract, the following principles should be observed:
(1) Interaction with Contractor Personnel
(a) All contractors:
(i) The contract shall govern contract performance. This can best be
accomplished with a well-defined statement of work (SOW), including SOWs in work
assignments (WAs), technical direction documents (TDDs), or delivery orders (DOs), which
reference the authority of the contract.
(ii) The PO shall notify the CO immediately if there is a need to change
the contract so that the CO can issue a contract modification.
(iii) Unless otherwise provided in the contract, all work will be initiated by
the issuance of WAs or DOs signed by the CO or if provided, by TDDs signed by the PO. These
will be issued to the contractor's official point(s) of contact as shown in the contract, e.g., Project
or Program Manager (PM) or Site Manager (SM). Any communication to the contractor's point
of contact shall come from the EPA CO, PO, or his/her authorized designees, e.g., WAMs,
DOOs, DOPOs, RPMs, OSCs, or TMs. Other EPA employees may not assign tasks unless they
have specific authority to do so. Note: TDDs may only be used to initiate work in contracts
requiring a fully-dedicated contractor team and as limited by the contract.
(iv) Technical direction shall be issued in writing from the PO or
authorized designee (with a copy to the CO) to the contractor's point(s) of contact. If provided
orally, the technical direction must be confirmed in writing within five (5) calendar days.
Technical direction shall not be used to initiate work or to change WAs or TDDs or the contract.
Agency employees shall not give instructions separately to individual contractor personnel.
(v) The PO or designee may authorize meetings with the contractor's
point(s) of contact for the purposes of exchanging technical information among contractor
personnel and EPA employees or assisting in contract performance, e.g., to discuss the status or
progress of effort under a WA or DO. Exceptions to the prohibition against direct interaction
between an Agency employee and contractor personnel include: l)a Government employee's
contacts to the various Agency hotlines and helplines to request and receive information and
literature regarding the Agency's media programs, 2) requests by Government employees for
technical assistance and ADP user support services where the technical assistance is mandated
and monitored under an existing contract, and 3) participation in discussions at professional
meetings attended by both Government employees and contractor personnel, which are not in
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connection with the performance of a contract. Examples of ADP user support services are
Personal Computer/Local Area Network (PC/LAN) troubleshooting support,
software support, PC training, data recovery assistance, and disk archiving and other similar
automated data processing (ADP) support as defined in a specific contract. These technical
services are rendered and the contract administered through established ADP support offices
such as the Washington Information Center (WIC).
(vi) Agency employees must not intervene in a contractor's hiring, firing,
or promoting of contractor personnel; assigning particular employees to specific tasks; or
rewarding individual contractor personnel. Evaluation of contractor performance, whether
positive or negative, shall be provided through the award fee process, if applicable, or through
the EPA PO to the contractor point(s) of contact. Evaluation shall relate to the timeliness or
quality of deliverables or services provided, and shall not be directed at the performance of
individual contractor personnel.
(vii) Agency employees shall not ask contractors to hire in a "holding
pattern," individuals who may be candidates for Agency positions, pending completion of
competitive civil service procedures.
(viii) Agency contracts shall not require or permit contractors to purchase
supplies or services for use by EPA employees unless specifically required by a contract for its
performance.
(ix) All requests for corrective or follow-up actions by contractors shall be
directed from the EPA PO or authori2ed designee to the contractor point(s) of contact. Similarly,
contractor personnel must operate through the contractor's point of contact to obtain any
information needed to complete the work.
(x) Agency employees shall prepare appropriate documentation for the
record of meetings, trips, and telephone conversations relating to the contract.
(b) Contractors working in EPA facilities only:
(i) Agency employees must avoid situations in which one EPA on-site contractor
provides support to another EPA on-site contractor, except when the contract requires such
support to be furnished (e.g., janitorial services or security services). Similarly, Agency
employees shall avoid situations in which one EPA on-site contractor provides oversight for
another EPA on-site contractor.
(ii) Agency employees shall not routinely provide contractor personnel with
copies of EPA internal administrative or other correspondence, except when it affects the
conditions of the facility in which the contractor's personnel are working (e.g., scheduled repair
work to be performed or building closings).
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(iii) Agency employees shall not provide contractor personnel with access to
facsimile machines, photocopiers, computers, or file rooms where the Agency receives, copies,
or stores sensitive or confidential information unless appropriate safeguards are in place to ensure
adequate protection of this information. These safeguards include security clearances, signed
confidentiality statements, and others. Sensitive or confidential information includes information
protected under the Trade Secrets Act or Privacy Act, confidential business information,
management sensitive information, and enforcement sensitive information. An example of
acceptable access after the appropriate safeguards are in place is the EPA Secure
Telecommunications Center, which processes cables to the EPA from the State Department
secure network, for which contractor personnel have security clearances. CBI may not be given
to contractor personnel under any circumstances unless there is authority for such disclosure and
the procedures under 40 C.F.R. Part 2, Subpart B have been followed.
(2) Identification of Contractor Personnel
(a) All contractors:
(i) At all times, it shall be readily apparent which organization employs an
individual. Agency security offices must require contractor personnel to display appropriate
badges that identify them as contractor personnel. The employing organization should also be
identified. These requirements shall be included in all contracts that may create situations in
which contractor personnel could be mistaken for EPA employees, e.g., advisory and assistance
services contracts, hotline/helpline contracts, community meeting tasks, or field work tasks under
Superfund contracts.
(ii) In all points of contact, e.g., during meetings, on Agency systems such
as voicemail or electronic mail (d-mail or e-mail), Agency officials must require contractor
personnel to identify themselves as such and their employing organization.
(iii) Agency security offices shall ensure that contractor personnel do not
have unlimited access to EPA office areas.
(b) Contractors working in EPA facilities only:
(i) In official telephone directories and listings, contractor listings shall be shown
in a type-face different from that used for Agency employees, in separate listings, with special
codes, designated by use of asterisks or parentheses, or in some other manner that distinguishes
contractor personnel from EPA employees.
(ii) Contractor personnel subject to the Service Contract Act shall wear company-
issued uniforms, in accordance with their company policies, e.g., moving contractors, security
guards, janitorial workers, etc.
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(3) Attendance at EPA Functions and Meetings
All contractors:
(a) Agency employees shall not allow contractor personnel to attend EPA
functions, staff meetings, committees, or activities, including holiday parties, except as described
in (b) below.
(b) Agency employees shall not allow contractor personnel to attend EPA
meetings or conferences (including conference calls) unless required for contract performance, as
documented in the contract's statement of work or in a specific WA, TDD, or DO.
(c) The CO, PO, or authorized designee shall notify the contractor point(s) of
contact through authorized technical direction of the need for attendance by contractor
personnel. Attendance must be restricted to specific tasks as defined in the SOW and limited to
the portion of the session in which the contractor's performance is directly required. Contractor
personnel shall never attend meetings as the official representative of an EPA organization.
Contractor participation is generally appropriate when the contractor is serving in an
advisory or resource capacity, such as performing research or data gathering. Contractors may
also act as facilitators for EPA Quality Action Team sessions under contracts for Total Quality
Management implementation.
(4) Contractor Employee Conduct
All contractors:
(a) Agency employees shall not be responsible for resolving contractor
personnel's business or personnel matters. Contractor personnel must be directed to their point(s)
of contact for resolution of these issues in accordance with the contractor's policies.
(b) Agency employees shall not provide contractor personnel with
direction for performance of work products or assignments. Contractor personnel must operate
through their point(s) of contact to obtain any direction needed to complete work products or
assignments.
(5) Space
Contractors working in EPA facilities only:
(a) To the extent possible, EPA employees shall be physically located in separate
areas from contractor personnel; the contractor's areas shall be identified as such.
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(b) In cases in which both EPA employees and contractor personnel must occupy
or use a general area, there must be physical separation and identification of space.
(c) EPA shall arrange schedules and set priorities for the use of any common
equipment by both contractor personnel and Agency employees.
(d) EPA may provide furniture, PCS, software, documentation, telephones,
voicemail and other equipment to contractor personnel working in EPA facilities when specified
in the contract.
7. ADDITIONAL GUIDANCE.
a. As in any contract situation, Agency employees should contact the CO and Contracts
Law Branch, OGC for advice and guidance as required on a case-by-case basis.
b. For further information on this subject, Agency employees should contact the
Procurement Policy Branch, Office of Acquisition Management.
/S/
Jonathan Z. Cannon
Assistant Administrator
for Administration and
Resources Management
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APPENDIX A to EPA Order 1900.1A
Examples of Prohibited Personal Services
1. An EPA employee routinely gives instructions and directions directly to contractor personnel.
2. An EPA employee recommends/requests/refuses to have specific contractor personnel
assigned to work on a delivery order or work assignment.
3. There is a change in the fields of a database to be maintained by the contractor. An EPA
employee instructs a contractor employee on how to perform the changes, rather than having a
contract-authorized official issue a written technical direction and/or contract modification for
the changes. This would be sent to the contractor point(s) of contact for subsequent instruction
to the contractor personnel.
4. An EPA employee suggests promotion, a bonus or other performance award for certain
contractor personnel.
5. An EPA employee sits in on an interview for potential contractor employees and offers
suggestions on whom to hire.
6. An EPA employee invites contractor personnel to attend an EPA staff meeting or other EPA
session not related to contract work performance.
7. An EPA employee enters a contractor's work area when no contractor supervisor is present.
The EPA employee has specific requirements he/she wants accomplished and directs contractor
personnel to redirect efforts to the new assignment.
8. An EPA employee directly requests contractor personnel to prepare a special report (not
otherwise required by the contract) from a database that the contractor employee maintains.
9. A contractor employee participates as a member of the EPA committee planning an EPA
award ceremony.
10. An EPA employee is an EEO counselor. A contractor employee complains of mistreatment
from contractor management. The EEO counselor pursues the complaint.
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A Checklist for use by Cos and CORs to Avoid the Existence or Appearance
of Personal Services, Inherent Government Functions,
or Sensitive/Vulnerable Services
A. Supervision/Direction of Contractors
1. The WA/TO/DO SOW is specific, completion oriented, with clearly ( )
defined tasks and deliverables. They do not simply parrot
the language of the statement of work of the overall contract.
2. Contractor work plans are detailed, indicating how the work would ( )
be accomplished.
3. Staff assigned to monitor the WA/TO/DO is formally certified ( )
as a COR.
4. Technical direction is given to the Contractor only by the ( )
authorized COR.
5. Technical direction given verbally is subsequently documented. ( )
6. Technical direction is given only to the Contractor Project Manager ( )
or other authorized point(s) of contact.
7.' Where technical directives are used in lieu of WAs, TOs or DOs, ( )
they require that work plans be submitted. Such work plans are
forwarded to the Contracting Office.
8. Contractor staff do not serve as members of EPA committees. ( )
9. Contractor staff do not regularly attend EPA planning and staff ( )
meetings; attendance is by invitation only and for specific purposes,
such as to give a presentation.
10. Contractor staff do not "represent" EPA organizations or staff. ( )
11. Contractor and EPA staff do not serve on mixed "science teams." ( )
12. EPA staff do not request Contractor staff to purchase supplies or ( )
services for use by EPA employees, unless specifically required
by the contract.
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13. EPA staff prepare appropriate documentation on meetings, trips and ( )
telephone conversations related to the contract.
B. Identification of Contractor Staff
1. Contractor and EPA staff wear their badges visibly, clearly ( )
identifying their organization.
2. Contractor staff identify themselves as Contractor employees when ( )
they answer the phone at EPA sites.
3. Contractor staff identify their organization when they place ( )
calls to an EPA office or laboratory or other establishment
when conducting business related to the contract.
C. Shared Office Space and Equipment
1. Contractor office space is segregated from EPA office space and ( )
is properly labeled.
2. To the extent practical, Contractor and EPA staff do not use shared ( )
laboratory space or equipment in the same time period. Schedules and
priorities are established for the use of common space and equipment.
3. Contractor staff do not directly assist principal investigators ( )
in conducting research at an Agency laboratory or research facility.
(An example would be assigning specific technicians to support
specific ORD researchers.)
D. EPA Involvement in Contractor Staff Selection and Appraisal
1. EPA staff do not forward resumes received by EPA to the Contractor ( )
for potential employment.
2. EPA staff do not make hiring, firing or promotion recommendations ( )
to the Contractor.
3. EPA staff do not notify the Contractor of cash awards to EPA personnel. ( )
4. EPA staff do not provide feedback to the Contractor on the ( )
performance of individual Contractor employees.
5. The award fee process is the primary vehicle used to provide feedback ( )
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to the Contractor on CPAF contracts. On other contracts, feedback is
given by the contract COR to the individual designated by the Contractor,
and it focuses on the quality of services and deliverables, not individual
employees.
6. EPA staff do not direct the Contractor to use particular staff ( )
in conducting the work.
7. EPA staff do not direct the Contractor to retain or to use a ( )
particular Subcontractor or Consultant in conducting the work.
8. EPA staff do not hold open seminars at which prospective Contractor ( )
researchers give presentations as a basis for hiring. EPA staff
do not provide feedback to Contractor on such candidates.
9. EPA staff do not direct the Contractor to hire in a holding pattern, ( )
candidates for Agency positions, pending completion of competitive
civil service procedures.
E. Provision of Administrative Support Services
1. EPA staff do not give administrative assignments (e.g.. typing, ( )
editing) directly to individual Contractor support staff.
2. Work request forms are used for requesting administrative support ( )
services from the Contractor.
3. Written protocols are established for the use of administrative ( )
support services.
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Technical Direction - Dev (EPAAR 1552.237-71)(Apr 84)
(a) The Project Officer is the primary representative of the Contracting Officer
authorized to provide technical direction on contract performance. Generally, the
contract COR will monitor the overall contract, while the COR TOPO, DOPO or WAM
monitors her/his specific tasking document.
(b) Individuals other than the Project Officer may be authorized to provide technical
direction. If individuals other than the Project Officer are authorized to provide technical
direction, their names will be specified in the contract, delivery order, work assignment or
technical direction document as appropriate. A Delivery Order Project Officer, Work
Assignment Manager or Task Manager is authorized to provide technical direction,
subject to the limitations set forth below, only on his/her delivery order, work assignment
or technical direction document.
(c) Technical direction includes:
(1) Direction to the Contractor which assists the Contractor in accomplishing
the Statement of Work.
(2) Comments on and approval of reports or other deliverables.
(d) Technical direction must be within the contract and the delivery order, work
assignment or technical direction document statement of work. The Project Officer or
any other technical representative of the Contracting Officer does not have the authority
to issue technical direction which (1) institutes additional work outside the scope of the
contract, delivery order, work assignment or technical direction document; (2) constitutes
a change as defined in the "Changes" clause;ybr example, changing specifications, place
of delivery; (3) causes an increase or decrease in the estimated cost of the contract,
delivery order, work assignment or technical direction document; (4) alters the period of
performance; or (5) changes any of the other express terms or conditions of the contract,
delivery order, work assignment or technical direction document.
(e) Technical direction will be issued in writing or confirmed in writing within five (5)
calendar days after verbal issuance. One copy of the technical direction memorandum
will be forwarded to the Contracting Officer and the Project Officer.
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Monthly Progress Report - Dev (EPAAR 1552.2ll-72WJun 96)
(a) The Contractor shall furnish copies of the combined monthly technical and
financial progress report stating the progress made, including the percentage of the project
completed, and a description of the work accomplished to support the cost. If the work is
ordered using work assignments or delivery orders, include the estimated percentage of task
completed during the reporting period for each work assignment or delivery order.
(b) Specific discussions shall include difficulties encountered and remedial action taken
during the reporting period, and anticipated activity with a schedule of deliverables for the
subsequent reporting period.
(c) The Contractor shall provide a list of outstanding actions awaiting Contracting Officer
authorization, noted with the corresponding work assignment, such as subcontractor, overtime
approvals, and work plan approvals.
(d) The report shall specify financial status at the contract level as follows:
(1) For the current reporting period, display the amount claimed.
(2) For the cumulative period and the cumulative contract life display: the amount
obligated, amount originally invoiced, amount paid, amount suspended, amount disallowed, and
remaining approved amount. The remaining approved amount is defined as the total obligated
amount, less the total amount originally invoiced, plus total amount disallowed.
(3) Labor hours.
(i) A list of employees, their labor categories, and the numbers of hours worked for the
reporting period.
(ii)'For the current reporting period, display the expended direct labor hours (by EPA
contract labor category), and the total loaded direct labor costs.
(iii) For the cumulative contract period display: the negotiated and expended direct labor
hours (by EPA labor category) and the total loaded direct labor costs.
(iv) Display the estimated direct labor hours and costs to be expended during the next
reporting period.
(4) Display the current dollar ceilings in the contract, net amount invoiced, and remaining
amounts for the following categories: Direct labor hours, total estimated cost, award fee pool (if
applicable), subcontracts by individual subcontractor, travel, program management, and Other
Direct Costs (ODCs).
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(5) Unbilled allowable costs. Display the total costs incurred but unbilled for the current
reporting period and cumulative for the contract.
(6) Average total cost per labor hour.- For the current contract period, compare the actual
total cost per hour to date with the average total cost per hour of the approved workplans.
(e) The report shall specify financial status at the work assignment or delivery order level
as follows:
(1) For the current period, display the amount claimed.
(2) For the cumulative period display: amount shown on workplan, or latest work
assignment/delivery order amendment amount (whichever is later); amount currently claimed;
amount paid; amount suspended; amount disallowed; and remaining approved amount. The
remaining approved amount is defined as: the workplan amount or latest work assignment or
delivery order amount (whichever is later), less total amounts originally invoiced, plus total
amount disallowed.
(3) Labor hours.
(i) A list of employees, their labor categories, and the number of hours worked for the
reporting period.
(ii) For the current reporting period, display the expended direct labor hours (by EPA
contract labor hour category) and the total loaded direct labor hours.
(iii) For the cumulative reporting period and cumulative contract period display: the
negotiated and expended direct labor hours (by EPA contract labor hour category) and the total
loaded direct labor costs.
(iv) Display the estimated direct labor hours and costs to be expended during the next
reporting period.
(v) Display the estimates of remaining direct labor hours and costs required to complete
the work assignment or delivery order.
(4) Unbilled allowable costs. Display the total costs incurred but unbilled for the current
reporting period and cumulative for the work assignment.
(5) Average cost per labor hour. For the current period, compare the actual total cost per
hour of the approved workplans.
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(6) A list of deliverables for each work assignment or delivery order during the reporting
period.
(f) This submission does not change the notification requirements of the "Limitation of
Cost" or "Limitation of Funds" clauses requiring separate written notice to the Contracting
Officer.
(g) The reports shall be submitted to the following addresses on or before the of
each month following the first complete reporting period of the contract. See EPAAR
1552.232-70, Submission of Invoices, paragraph (e), for details on the timing of submittals.
Distribute reports as follows:
(Insert distribution requirements)
(End of Clause)
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Review of Deliverables Worksheet
Contractor:
Contract Number:
Task Order Number:
Task Order COR:
Deliverable Due Date:
Date of Receipt:
Deliverable Number and Title:
(From TO/Work Plan):
Description of Deliverable:
Decision: Accepted ( ) Rejected ( ) Modification Proposed ( )
Comments:
1. Were all specifications met to the desired level of quality? If not, what was missing?
2. Was deliverable timely? If not, did delay make deliverable of reduced value to EPA?
Why was it not timely?
3. What, if any, changes are needed to meet the specifications or improve quality or
usefulness?
4. Will any changes necessitate a task order modification?
Reviewer: Date Reviewed:
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Meeting Documentation Memorandum
MEMORANDUM
SUBJECT: Meeting with ABC Company on Status of WA 00-X
FROM: Work Assignment Manager
TO: The Record
DATE:
I met with (Project Manager) and (Program Manager) of ABC Company on
to discuss the status of WA 00-X.
Task 1 - Data Base Development
All questionnaires have been received, edited and entered. Listings have been
produced and are ready for validation. One issue is when we want to conduct
the validation and whether we want to ask for additional data from the labs. I
will follow up with Division Director.
Task 2 - Budgeting Manual
Contractor provided me an outline of the manual. It looks fine to me, but I will
have our branch chiefs review it before approving the outline. Contractors will
proceed with the first two chapters in the interim.
Task 3- Support to Steering Committee
Contractor has developed draft agenda and concept paper for first meeting of
Steering Committee. Contractor needs to know what graphics will be required.
I discussed topics for graphics with the Contractor; Contractor will get back to
me in three days with draft charts. I indicated changes on the agenda and
concept paper; Contractor will finalize.
cc: Div. Director
Project Officer
Project Manager, ABC Company
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Student Exercise No. 5-1
Please review the situations listed below and indicate whether these constitute appropriate use of
technical direction. Mark "A" for appropriate or "I" for inappropriate.
Situation Appropriate?
1. The WAM and Contractor PM meet after the work assignment is issued to discuss and ensure
all parties understand what is required forcertain tasks. ( )
2. The TQPO instructs the Contractor PM to prepare a draft as well as a final version of each of
the four drafts although the SOW didn't specify drafts. ( )
3. The DOPO meets with the Contractor PM and a statistical analyst for the Contractor on a
fixed-price completion order. The purpose is to discuss alternative approaches for dealing with
data gaps in the model for groundwater management. ( )
4. The COR requests that the Contractor prepare 40 copies of a 60-page report for distribution to
all the labs and offices. The task order didn't specify the number of copies. ( )
5. An Agency scientist with no delegated COR responsibilities asks the Contractor's senior
analyst to include chlorides and sulfates in the list of substances to be analyzed in 500
samples. ( )
6. The DOPO requests the Contractor use a specific subcontractor for analysis of data collected
in an industry survey because the expert in the field is a consultant affiliated with the
subcontractor. ( )
7. In response to a question from the Contractor, the TOPO tells the Contractor not to worry
about a particular task in the TO because the priorities have changed since the CO issued the
TO. ( )
8. The WAM asks the Contractor PM to use express mail for a deliverable to the Science
Advisory Board members to facilitate a peer review. ( )
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Student Exercise No. 5-2
Technical Monitoring
1. You are the COR on a WA involving the development of sampling plans, assessment
methods, QA manuals and implementation plans. The great majority of the work is being done
by one of three subcontractors under the prime Contractor. The first two deliverables on this six-
month WA are a detailed work plan and a draft sampling plan. Each of these have been two
weeks late and required substantial revisions, however, the contract COR and CO have finally
approved both planning documents. Of the four subcontractor staff working on the project, you
are dissatisfied with the performance of the^project leader_and one of the other staff. You do not
feel that project leader has the technical knowledge required for the task; your concern on the
other staff member is that she is abusive and has alienated certain EPA personnel. It is now the
beginning of the third month of the project. You are concerned about the quality of the other
deliverables and also the budget, although the technical/financial progress reports indicate no
problems. What actions should you take?
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Student Exercise No. 5-3
Contract Management Case Study
Break into small groups. Read the task order on the following pages. As a group, discuss your
response to the items listed below. Choose a spokesperson to present your group's findings to
the class.
1. In which of the following situations was technical direction given appropriately? The
COR issued written technical direction requesting the following:
a) Change the hours of operation to 10:00 a.m. until 7:30 p.m.
b) Update the list of documents the contractor must distribute
c) Establish a date and time for document pick up from the Agency ¦
d) Specify the monthly meeting will be held every other month at the contractor's site.
At which time the COR will conduct a site visit. \
e) Maintain the mail list database in Microsoft Word instead of WordPerfect.
List three management controls that would be appropriate for this contract. , Jf*
-
3. What would
IWfUM \0tM - /[\(oM / ¦/
/hat would be the proper way for the COR to handle the issues listed below?
a) The COR has gotten several complaints from the public and EPA employees about
one of the hotline workers. The worker is rude and unhelpful. 1 ~^C2 - \ t\
ritten and it's c
rn
b) TSCA has been rewritten and i^'scrucial that the contractor's employees are familiar
with these important changes. I ' \ 6/CC^ _
c) The contractor uses a subcontractor for the distribution services under the task order.
The sub contacts the COR to complain he is not being paid in a timely manner and that the
contractor's staff is slow in dropping off and picking up materials, thereby making it appear that
the sub is always late with the distributions. lO- CO .
d) While the COR was on vacation, the COR's supervisor ordered the contractor to
perform a special mailing to the constituents in Congressman Hoss' district. This is the 22nd
special mailing this year and it was much larger in number and materials from previous mailings.
e) A coworker shows the COR an article in the Wall Street Journal which states the TICS,
contractor was just acquired by Toxic Smoxic, Inc., a specialty chemical manufacturer that
develops and markets products for agricultural and commercial uses. ^
f) An EPA technical subject matter expert (TSME) sent a memo to the contractor's project Aiy
manager complaining about the rude employee and requesting the TSME be copied on all &
responses involving her area. ^
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Statement of Work for the
Toxic Substances Control Act (TSCA) Information Clearinghouse Service (TICS)
I. Background
This requirement is to provide information services to support all programs implemented under
the TSCA. The information services to be provided by the contractor shall take two forms: (1)
providing technical information responses to inquiries from public and private sector firms and
individuals concerning the requirements of particular TSCA regulations and (2) distributing
informational materials.
II. Hours of Operation
The contractor shall operate the TICS, Monday through Friday, from 8:30 a.m. to 5:00 p.m.,
eastern time, excluding all Federal holidays. TICS staff shall be available during the above core
hours to personally receive and respond to telephone calls, letters, facsimile, e-mail requests, and
walk-ins.
III. Responses to Inquires
1. The contractor shall provide timely (immediate response to questions or call-back within
one working day), accurate (cited from TSCA or other pertinent statutes), and courteous
responses to telephone, e-mail, fax, and letter inquiries for information concerning
pertinent statutes and related regulatory activities. Most responses shall be given directly
by phone, through call-backs, after researching answers, or by distributing relevant
documents (e.g., Federal Register notices, fact sheets, guidance documents, etc.).
2. The COR will provide the contractor with the initial contact and referral lists of technical
subject matter contacts within EPA (including the Regions), other federal agencies, state
and local governments, other hotlines and information services to consult when
researching answers to technical regulatory questions. The contractor shall rely on
published information and oral information provided by the COR or other program
officials to give facts related to regulatory activities.
3. The contractor shall distribute a variety of documents in response to telephone calls,
facsimile requests, letters, and e-mail requests. Document requests shall be delivered to
the EPA Mail Room within one working day in EPA provided envelopes: (EPA will pay
postage.) As requested by tlie caller, documents shall be faxed within one working day,
provided the document is no more than 10 pages in length and legible. A list of
documents, maintained by the Office of Prevention, Pesticides, and Toxic Substances
(OPPTS), will be provided to the contractor. The contractor shall explain to callers how
to electronically access EPA/TSCA documents, as required.
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Statement of Work for the TICS (continued)
IV. Distributing Materials
1. The contractor shall maintain an inventory of those TSCA-related documents the COR
specifies to be distributed directly by the TICS. The contractor shall also maintain a
database of pertinent regulatory materials and their availability, and shall maintain
reference copies of these materials in the TICS reference files.
2. The contractor shall provide storage for up to 300,000 documents annually. The
contractor shall transfer documents, if necessary, from sources such as EPA's Print Shop
or other EPA staff offices located within the Office of Pollution Prevention and Toxics
(OPPT) and transport them to the contractor's storage facility.
3. The contractor shall meet with the Project Officer biweekly to resolve technical
questions, issues, and problems relevant to the operation of the TICS and to ensure an
appropriate information exchange. These meetings normally will be held at EPA
Headquarters; however, at the COR's discretion, they may occasionally be held at the
contractor's site.
4. The contractor shall assist with 15-20 special mailings per year. Most mailings shall be
small-scale, averaging approximately 100 addressees per mailing and 5-10 pieces of
material per addressee. There shall be one large-scale annual mailing, averaging
approximately 2000 addressees and three pieces of material per addressee. The contractor
shall assemble and stuff documents into EPA provided envelopes, and deliver to the EPA
Mail Room within 1-3 working days, depending on the size of the mailing (EPA will pay
postage).
5. The contractor shall create, maintain, and update a sort able database containing the
mailing lists used for these special mailings. In accordance with current Agency
recommendations, the contractor shall use Lotus Notes or a compatible system. Current
mailing lists shall be maintained in WordPerfect-9 and will be provided to the contractor.
The contractor shall supply printed labels for each mailing.
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Chapter 6 - Financial Monitoring (Invoice Review Process)
1. The Importance of a Thorough Invoice Review
a. EPA pays out more than $1.6 billion yearly to contractors, with more than 60 percent
of the payments made by electronic funds transfer (EFT). The Agency must comply with OMB
Circular A-127, Prompt Payment Act, effective October 29, 1999 which requires us to pay
contractors within 30 calendar davs of receipt of a proper invoice. The Agency continues to
hold an excellent record (better than 98% compliance) in processing payments within 30 days.
We also diligently seek cash discounts ("discount terms" on your invoice) for even quicker
paiyments when offered by contractors.
b. Invoice review is a critical function impacting the management of public funds. CORs
must (1) review contract invoices thoroughly for cost reasonableness, and (2) process invoices in
a timely manner. Adherence to this practice will result in payment of costs which are allowable,
allocable, and reasonable, and avoid interest penalties due on late payments. For more guidance,
the Invoice Review Guide is available at http://intranet.epa.gov/oamintra by clicking on contract
financial information. Chapter 11 of the Contracts Management Manual also covers procedures
for invoice review. It is available at the same site.
c. It is very important that CORs closely examine and, when appropriate, question or.
suspend contractor costs. Every COR must document his or her files to shown that invoice
review was performed. CORs must maintain a file of all invoices, invoice review checklists, and
all other documentation associated with the invoices for the life of the contract.
¦®" Safeguard contractor invoices - they contain confidential]business)information.
2. Make It EASY
a. The Electronic Approval System (EASY) is a PC-based system that allows CORs and
their alternates to approve invoices on-line. EASY takes the place of the hard copy invoice
approval form (EPA Form 2550-19) that CORs received in pink envelopes. Unless an exception
is approved by the Financial Management Center-RTP, all CORs who approve invoices must use
EASY.
b. Office of the Chief Financial Officer, Comptroller Policy Announcement No. 01-08,
dated September 21, 2001 has Agency policy and procedures for using the EASY to process
contractual payments, information on installing EASY, and the EASY tutorial system. The
Policy Announcement is available at http://intrariet.epa.gov/ocfo/policies/policv/pa01.htm.
3. Key Players in the Invoice Review Process
a. The following individuals or organizations are key players in the invoice review,
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approval, and payment process.
(1) PO or Contract-Level COR and Delivery/Task Order COR - reviews and
approves invoices. Required to submit their approval or disapproval to the paying office.
(2) Work Assignment COR - coordinates with the PO on reviewing invoices,
but does not have authority to sign them.
(3) RTP's Financial Management Center (RTP-FMC) - the "paying office," is
required to certify and transmit a payment authorization to the Department of Treasury within 30
calendar days from the receipt of a contractor's invoice, subject to receipt of the COR's invoice
approval. (Note that some invoices, such as orders under the GSA Schedule, are paid by your
local paying office.)
(4) Audit agencies or organizations - audits contractors' accounts, includes
OAM's Financial Analysis and Rate Negotiation Service Center, the Defense Contract Audit
Agency (DCAA), or cognizant contract administration office.
b. Effective January 2, 2003, the Office of the Comptroller rescinded Office of the
Comptroller Transmittal Notice 89-13 which allowed supervisors to sign invoices in the absence
of the COR. This means that only the COR or an alternate COR (appointed by the CO) may
approve invoices. To continue to meet the Agency's excellent record on invoice turnaround,
each basic contract, delivery or task order must have an alternate COR who can sign invoices in
the absence of the regular COR.
4. Allowability, Allocability, and Reasonableness of Charges
a. There are three general areas in which invoices should be reviewed: Allowability,
Allocability, and reasonableness. CORs are responsible for determining the reasonableness of
charges. Allowability and allocability are determined by the CO, with the assistance of auditors
and program staff. However, CORs should attempt to review invoices for Allowability,
allocability to the best of their ability and raise appropriate issues to the contractor and CO for.
further review.
(J) Allowable charges are those costs allowed by the FAR, generally accepted
accounting principles, and the specific terms of contract, h or example, ^contract may have a
ceiling for travel, if travel costs billed exceed that ceiling, they are unallowable.
(T) FAR defines an allocable cost as:
(a) a cost incurred specifically for the contract (a direct cost), such as the
cost to rent a hotel room for a meeting required in a work assignment, or
(b) a cost which benefits the contract and other work, and can be
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distributed to them in reasonable proportion to the benefit received (an indirect cost). Two
examples would be rent for the contractor's office space and benefits paid to contractor
employees.
Direct and indirect charges are explained further in section 7. Allocable costs must be logically
assigned as a direct or indirect charge in accordance with the contractor's approved accounting
system. This method of charging must be consistent and not result in any duplicate charging.
(3) FAR states a cost is "reasonable" if, in its nature and amount, it does not
exceed that which would be incurred by a prudent person in the conduct of competitive business.
The COR should exercise his or her technical expertise and make initial determinations whether
a cost was technically reasonable for the contract or project. For example, the workplan
estimated it would take 121) hours over three months to complete a task, in the first month of the
work assignment, the Contractor bills for 300 hours to complete that task with no explanation of
the charge.
5. Getting Started
a. Before reviewing the invoice, the COR must have:
(1) Knowledge of any special contract terms and conditions;
(2) A copy of the work assignment or delivery/task order issued by the CO,
including all amendments;
(3) A copy of the CO-approved work plan. This document is the basis for
monitoring the contractor's performance. You can compare what the contractor is accomplishing
on the project versus how it was planned or estimated;
(4) The Monthly Progress Report (MPR) or appropriate technical and financial
sections of the MPR associated with your project;
(5) A copy of the invoice or that portion associated with your project;
Once you participate in several invoice reviews, these last three items will become the principal
documents utilized monthly.
6. The Monthly Progress Report (MPR)
a. The most important document to assist you with invoice review is the contractor's
MPR. Each Agency service contract contains a clause requiring the contractor to submit a
combined monthly report on technical and financial progress at the contract and work
assignment, delivery or task order level. There are two alternates to this clause: one for fixed rate
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contracts arid one for cost reimbursement contracts. In either case the clause specifies the
financial and technical information required in the MPR and when this information is due, e.g.,
the 10th of each month-this period must match the invoice period.
b. In general, the MPR provides the contractor's assessment of the effort expended and
progress made for the reporting period. The COR's expertise is needed to assess if the reported
progress is commensurate with the monthly invoice. Areas such as "difficulties encountered,"
"remedial actions," and "outstanding actions" require close scrutiny to ensure the COR and
contractor are communicating and following up appropriately to enhance progress.
c. The clause requires to list unbilled allowable costs, both for the current reporting
period and cumulative for the contract. Watch this area for unbilled subcontractor costs and
indirect rate changes not yet applied.
d. Generally, the format and content of MPRs is standardized for every Agency contract.
The CO may add information requirements through a contract modification; however, these
requirements may increase contractor costs for preparing the report and require additional time
for COR review. These costs should be considered before changing the MPR format.
7. The PO's Role in Invoice Review
a. The PO is responsible for overseeing costs on the contract as a whole. An invoice
review checklist for POs is provided on pages 3-18 and 3-19. Under a cost-reimbursement
contract the PO is also responsible for monitoring the work assignment costs. In this case, the
PO should forward a copy of the invoices, MPRs, additional instructions, checklists, or guidance
to the cognizant work assignment CORs for their review before approving the invoice. A
"Sample Fact Sheet" which outlines some basic, contract specific information POs should share
with their work assignment or task order CORs to assist them in reviewing invoices can be found
on page 3-21.
8. Tracking Funding and Total Hours
a. Generally, the PO will track funding levels and level of effort (LOE) usage for the
overall contract. Work assignment and task order CORs will track this information for their
order under the contract. Sections (1) through (7) on the following pages describe areas related
to funding and LOE which CORs must track.
(1) Amount of Funds Remaining -The contract must have sufficient funds to
cover all work ordered. POs should regularly check funds available in the contract against
expenditures in the invoices. It is a violation of the Anti-Deficiency Act to allow the contractor
to incur costs without sufficient funding on the contract to pay the firm.
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(2) Multiple Appropriations - EPA receives funding from several appropriations
and may fund a contract, task or delivery order from one or more of these appropriations.
Allocation of funding must be based on appropriation benefit, rather than which account can
"afford" the work. Additionally, the use of funds from one appropriation because of the absence
of funding in another violates basic appropriation law. For contracts funded using more than one
appropriation-where multiple accounts are used, the COR must document the rationale for use of
multiple appropriations and the method for distributing the costs to the appropriate accounts.
Invoices must be paid in accordance with the approved distribution. See the discussion in
Chapter 7, Section 7.4 of the Contracts Management Manual for specific information on this
topic.
(3) To help the Agency track costs under the Government Performance and
Results Act (GPRA), a program results code (PRC) is included within the "program" field of the
Agency's account number structure. Invoice payments must match actual costs incurred. POs
are responsible for disbursing funds in accordance with the appropriate account PRC. An
overview of this system is available on the intranet at
http://intranet.epa.gov/ocfo/about/gpra/training.htm.
(4) IT Cost Accounting - The Office of the Comptroller issued Comptroller
Policy Announcement No. 01-10, New Information Technology Accounting Requirements in
September 2001. The policy established a standard, agency wide method of coding the costs of
EPA's investment in information technology (IT) within the Agency line of accounting. If your
contract involves IT hardware, software development, or services, work with your budget or IT
point of contact to ensure costs are tracked appropriately.
(5) Where the contract has cost ceilings, the PO must monitor invoices to ensure
these ceilings are not exceeded. These ceilings can be in a specific area, such as travel costs,
subcontract costs, or on other direct charges as a whole.
(6) One of two clauses will be in a cost reimbursement contract to require the
contractor to notify the CO when total contract costs or funds are close to being exceeded.
(a) The Limitation of Costs clause (for fully funded contracts) states that
the contractor must notify the CO if (1) the costs the contractor expects to incur in the next 60
days, when added to all costs previously incurred, will exceed 75% of the estimated cost
specified in the contract; or (2) the total cost for the performance of the contract, exclusive of any
fee, will be either greater or substantially less than had been previously estimated.
(b) The Limitation of Funds clause (in incrementally funded contracts)
requires the contractor to notify the CO in writing whenever it has reason to believe that the costs
it expects to incur under the contract in the next 60 days, when added to all costs previously
incurred, will exceed 75% of the total amount so far allotted to and placed in the contract by the
Government. The notice shall state the estimated amount of additional funds required to
continue performance for the period specified in the contract.
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(c) Once these cost or fund limitations are met, the contractor cannot incur
additional costs until it is authorized in writing by the CO. If the contractor fails to notify the CO
in accordance with these clauses, the Government is not obligated to reimburse the contractor for
any costs in excess of the estimated cost.
(7) Under cost-reimbursement contracts, monitor the total hours ordered and
total used by the contractor. Report any underutilization to the CO. (The contract may have to
be modified if the estimated hours are not being used as anticipated.) Take a look at the
following scenario which is an example of not monitoring hours ordered versus hours used:
In 1995 EPA awarded an LOE contract as follows:
EPA's Estimate Hours Used % Used
Base period: 33,800 hours 435 1.3
Option: 52,000 hours 5,874 11.3
Cost: $5,000,000 $545,648 10.9
The contractor disputed this contract, arguing that the firm was entitled to more money than the
amount tied to the hours actually used. After a series of court rulings and appeals, the U.S. Court
of Appeals for the Federal Circuit found the Agency in breach of contract. The court ordered the
Agency pay the contractor actual damages up to the amount of funds allotted, i.e., obligated, on
the contract.
"•* Lessons learned in light of this decision:
1. Your LOE estimates are important and should represent realistic
expectations of contract usage.
2. If you anticipate that you won't use the hours specified in the LOE
clause (typically less than the 90% of the amount specified for a particular period), notify your
CO promptly (at least 60 days before the end of the contract period).
3. The CO should attempt to bilaterally modify the contract to remove the
excess LOE hours, adjust the fee, and reduce the funding specified in the Limitation of Funds
Notice clause which implements the*contract clause at FAR 52.232-22, Limitation of Funds. If a
bilateral contract modification is not feasible, the CO should consider partially terminating the
contract for convenience by removing the excess hours, adjusting the fee, and reducing the
funding specified in the Limitation of Funds Notice clause which implements the contract clause
at FAR 52.232-22, Limitation of Funds.
4. Guard against the practice of placing funds on an LOE contract for the purpose
of preserving the funds for other uses, rather than for use in reimbursing incurred costs on the
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contract. This "banking of funds" may give the contractor a false expectation of what will be
ordered under the contract and expose the Government to the risk of losing the funding.
9. Reviewing Work Assignment, Delivery Order or Task Order Invoices
a. Work assignments are funded at the contract-level. Thus, the contractor submits one
invoice for all the work assignments under a contract. The PO is responsible for approving the
invoice. Nevertheless, work assignment CORs play a vital role in invoice review. POs should
involve work assignment CORs in the invoice review process by giving them an opportunity to
examine the portion of the MPR and invoice applicable to their work assignment.
b. Because task orders are individually funded, task order CORs have authority to sign
invoices for their respective task orders. When reviewing work assignment, delivery or task
order invoices, CORs should examine whether the cost is charged correctly under the terms of
the contract and whether the cost is reasonable. An invoice review checklist for work assignment
or task order CORs is provided on page 3-20.
c. Generally, invoices are divided in two broad categories: direct and indirect costs.
Direct costs are costs the contractor expended in direct performance of your task order or work
assignment. These costs include the hours of the staff who worked on your contract, called
direct tobor and a broad category, called other direct costs or ODCs such as supplies, travel,
equipment, subcontracts, consultants, courier service, or long-distance phone charges. The
sample work assignment "invoice" on page 3-22 shows how invoices costs are typically broken
down.
d. The contractor's method for breaking out costs is based on their accounting system
and the contract terms. The contractor must be consistent in charging direct costs, ODCs and
indirect costs. For example, fringe benefits (sick leave, vacation time, insurance, etc.) can be
classified as a direct or indirect cost depending on the accounting system the contractor uses.
While cost breakouts may vary between contractors, a particular contractor must use a stand
method for each invoice. Let's review these broad areas separately.
10. Direct Labor
a. On a labor hour or fixed rate contract, the labor charges are fixed for each labor
category per contract option period. Fixed rates include wages, indirect costs, general and
administrative expense, and profit. On a cost-reimbursement contract, the contractor is
reimbursed for costs incurred, therefore the labor rates can change at any time. Labor is charged
separately from indirect costs, general and administrative expense, and fee. When reviewing
labor costs, consider the following questions:
(1) Under a fixed rate contract, do the rates charged and the period of
performance to which they apply agree with the rates shown in the contract for that period of
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time? For example, in option period I, the fixed rate for an endocrinologist is $100 per hour.
This rate must remain the same for the entire option period, unless the CO modifies the contract.
(2) Under cost reimbursement contracts, the contractor can bill only actual costs
for labor. If possible, compare actual costs billed to the costs the contractor listed in its proposal
or approved work plan. Significantly higher rates should be questioned.
(3) Is the contractor charging for a labor category you haven't seen before, such
as managers or clerical personnel not identified as direct costs in the contract or approved work
plan? Generally, under cost reimbursement contracts, clerical and management personnel are not
billed as a part of the LOE.
(4) Are the number of hours used reasonable for work that completed? For
example, is it reasonable for the contractor to take 40 hours to review a draft report?
(5) Were the labor categories (skill mix) used appropriate for the work done? For
example, was a scientist used to take water samples? Can the contractor justify the level of
expertise for the work performed? Excessively rich labor mixes (using higher level staff than,
needed), sometimes called "gold plating," can quickly drive up the average cost of direct labor
on LOE contracts. Question if the contractor might effectively use lower labor category
personnel. Contractor employees can be charged to more than one labor category if they are
working in various areas. For example, a toxicologist may also qualify as a chemist; however, if
the toxicologist is performing chemist work, then she must be charged as a chemist.
(6) Is the contractor billing employees at a fixed labor rate in excess of rates for
which they qualify under the contract? For example, does Dr. Jones meet the contract
requirements for an endocrinologist?
(7) If the invoice contains overtime charges, is the charge allowed for this labor
category? Was the required CO authorization obtained in advance?
11. Other Direct Costs
a. As previously stated ODCs are a catchall category which includes items such as travel,
supplies, subcontractor billings, and so forth which are directly applicable to the work performed
on the contract. Sometimes ODCs will be listed on the invoice as a lump sum, for example,
$ 10,000. If you don't know what this consists of, you should ask the contractor to document the
costs. Also, question ODCs in the following areas:
(1) Equipment - If the contractor is charging for equipment, did the CO approve
the purchase? (Note: Per the FAR, contractors are expected to provide all property for
performance of the contract except under limited circumstances. Equipment will normally not be
a direct charge to the contract.)
6-8
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(2) Subcontracts - Generally, the CO must consent to the use of consultants or
subcontractors. Ensure CO consent was obtained before approving payment in this area.
Subcontracts costs fall into the ODC category, the hours are added into the direct labor category.
The hours count against the contract LOE. Charges for subcontracts must be detailed showing
the major cost elements for each subcontract. For subcontracts exceeding $5,000, the invoice
must detail current and cumulative charges by major cost element such as direct labor, overhead,
travel, equipment, and other direct costs.
(3) Travel - Was the trip necessary to contract performance? For travel, the COR
should also scrutinize the number and labor categories of contractor employees involved. Were
the actual costs for airfare, hotel, car rental, etc., reasonable?
(4) Was the use of Federal Express or a courier necessary?
(5) Contractors should not charge for supplies, equipment, other direct costs at
preestablished rates which do not reflect actual incurred costs.
(6) Any charges that are not sufficiently detailed to determine what is being billed,
the reason for the charges, or whether necessary should be questioned.
12. Indirect Costs
a. Indirect costs are thd contractor's general business costs which are not directly
related to your contract. These costs include rent, heat, light, depreciation, office supplies, legal
fees, telephone, and management salaries, for example. Understanding what makes up an indirect
cost can be challenging, but the good news is the COR is not responsible for deciding what goes
into the indirect rate, only that it is applied in accordance with the contract.
b. There may be several indirect rates applied to your contract. One indirect rate, called
"labor fringe benefit package" includes contractor employees' health insurance, annual leave,
tuition reimbursement, training, etc. Usually this cost is charged on an invoice as a percentage of
the direct labor costs or it may be included as part of the overhead rate. Depending on your
contractor's accounting system, there may be other indirect rates for copy center costs, computer
costs, on-site labor, and so forth. The CO negotiates these pools and rates with the contractor.
As the COR you need to be aware of what these indirect rates are and how they are properly
charged on invoices.
c. Another indirect rate is G&A, short for "general and administrative" expenses. This
includes costs for running executive offices, including staff services such as legal, accounting,
and other costs related to overall business operation. Usually, G&A rates are reflected in the
invoice as a percentage of the sum total of direct labor, ODCs, labor fringe costs, and any other
overhead costs. However, the method of applying the G&A rate may vary by contract.
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d. Indirect rates are either provisional or final. "Provisional" means the CO agreed to a
rate based on the contractors anticipated costs for a periotfoFRffie^.g., how much the contractor
will spend in a year on rent or electricity. Eventually provisional rates become final after those
costs are incurred and the CO negotiates a final rate which reflects the actual costs incurred. The
indirect rates will change during the life of the contract. These changes will be reflected in the
revised rate agreements the CO or cognizant contract administration organization negotiates.
The rate your contractor bills on an invoice must reflect the rate(s) listed in the most recent
agreement. Contractors cannot bill for a revised rate before the rate agreement is final.
Ensure your contractor is charging the proper indirect rate. If the contractor is
using a lower rate, the Agency could owe the firm a large amount of money,
particularly if this fact isn't discovered until contract closeout.
e. Retroactive adjustments to the contract for indirect rates require submission of a
separate invoice with its own supporting documentation. Contractors must also adjust
cumulative billed costs on invoices and MPRs to reflect indirect rate changes. Indirect rate
agreement vouchers are due 60 days after an indirect rate agreement is finalized.
f. What is charged as an indirect or direct cost on a contract varies for each contractor
based on its approved accounting system. As with direct costs and ODCs, the contractor must be
consistent when charging a cost as indirect or direct. If you think your contractor is charging
something directly to the contract which should be an indirect cost, get clarification from the CO
before approving the invoice.
g. The following contract costs are typically charged as indirect costs. Question them if
they are billed directly to your invoice:
(1) Parties, luncheons, coffee services, potted plants.
(2) Supplies (including items such as toilet paper) that serve a general purpose
applicable to all work performed by the contractor.
(3) Computer software.
(4) Employee training (unless the contractor had the CO's prior, written
approval).
(5) Corporate level personnel, such as vice presidents, etc.
h. The following costs should never be charged as a direct cost to an Agency contract:
(1) Alcoholic beverages, food, or entertainment.
(2) First class airfare.
(3) Interest, bad debts, contributions.
(4) Public relations, advertising, lobbying costs.
(5) Gifts to employees.
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When these costs are charged indirectly, the CO or an auditor is responsible for reviewing the
indirect cost pool and determining which costs are apprqpriate.
13. Also Check
a. Billing fixed or base fee af variance from contract provisions, e.g., billing fee as a
percentage of costs instead of proportionate to the level of effort hours delivered. In many
contracts the fee is calculated as a fixed number ($4.25) added to each LOE hour. This fixed
number is calculated by taking the total fee divided by the total LOE.
b. Even though contractors generate invoices on computers, perform math checks to
ensure the correct formulas were used, numbers add up correctly, and there are no charges listed
twice, i.e., "double-billing" for the same cost.
14. Suspending and Disallowing Costs.
a. If there are math errors, incorrect rates, lack of available funding (due to the limitation
of funds or limitation of cost clauses of the contract), costs not satisfactorily explained, or other
invoice irregularities, CORs who have authority to approve invoices also have authority to
suspend payment of invoiced costs.
b. When you question a cost, first check with your contractor to see if there is a
reasonable explanation for the cost or if the firm can provide documentation justifying the cost.
If the issue cannot be resolved before the invoice is due to the paying office, then the COR
should recommend suspending the questioned costs and notify the CO of the problem.
c. Costs are officially suspended using EPA Form 1900-68, Notice of Contract Costs
Suspended and/or Disallowed. (A copy is provided on page 3-23.) The COR forwards the form
with the invoice to the payment center with a copy to the CO, the Manager of the Financial
Analysis and Rate Negotiation Service Center in OAM (3802R) and the contractor. If the reason
for suspending the costs cannot fit in block A of the Form, attach description of what costs are
being suspended and why. A sample rationale for suspending invoice charges (to be attached to
the Form 1900-68) can be found on page 3-25.
d. If costs are questioned because the contractor performed services which were not
within the scope of the contract, the COR must take the necessary steps to request the CO ratify
an unauthorized commitment. As stated in Chapter 2, not all unauthorized commitments can be
ratified. Unless and until the ratification process has been completed, the costs cannot be paid.
e. The invoice payment should not include suspended amounts. Where direct costs are
suspended or disallowed, applicable indirect costs (fringe, overhead, general and administrative)
and fee should also be suspended or disallowed. The following example illustrates this:
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Costs on Invoice:
If the COR Questioned $ 1,000 in direct labor
Amounts Ouestioned:
Direct Labor
$10,000
Direct Labor
$ 9,000
$1,000
Fringe @ 25%
$ 2,500
Fringe @ 25%
$ 2.250
$ 250
SUBTOTAL•
512,500
SUBTOTAL
$11,250
$1,250
Overhead @ 75%
$ 9, 375
Overhead @ 75% $ 8,437-50
' $ 937.50
ODCs (total)
S 1,000
ODCs (total)
$ 1,000
—
Subcontracts
$10,000
Subcontracts
$10,000
...
SUBTOTAL
$32,875
SUBTOTAL
$30,687.50
$2,187.50
G&A (a), 10%
$ 3.287.50
G&A ®10%
$ 3,068.75
$ 218.75
TOTAL
$36,162.50
TOTAL
$33,756.25
$2,406.25
Associated Fee billed on 20 hrs DL LOE. @$4.00 = $ 80.00
Total $2,486.25
f. The contractor is allowed 60 days to justify the suspended costs. If the contractor
submits information showing the costs were valid, then the COR or CO can lift the suspension
by completing the Removal of Suspension, section B, on the original form and distributing it.
The contractor must submit a new invoice for the costs that were suspended, along with a copy of
the revised Form 1900-68 indicating removal of the suspension. The use of a separate voucher
allows for better tracking to determine if suspended costs under a contract have been rebilled and
paid.
g. If the contractor cannot justify the questioned costs, the CO may disallow the charges
by completing Disallowance of Costs, Section C, of the form. The contractor may not resubmit
those disallowed costs for further payment, but may challenge the CO decision by filing a claim
under the Disputes clause of the contract. Only COs can disallow costs.
15. Role of RTP-FMC in Invoice Review
a. For most Agency contracts, the Financial Management Center at the Research
Triangle Park (RTP-FMC) is responsible for paying all Agency contract invoices following the
procedures outlined below.
(1) Receives original and copies of invoice from the contractor; the invoice is
date/time stamped for Prompt Payment purposes the same day it is received in RTP-FMC
mailroom.
(2) Logs appropriate invoice information into the Contract Payment System
(CPS). Various queries, such as account balances, invoice status, are available from the CPS .
online at http://oasint.rtpnc.eDa.gov/neis/cpscon web.cpscon inquiry.
(3) Determines if invoice is "proper" within seven days of receipt (consistent with
OMB Circular A-125). Improper invoices are returned to the contractor indicating the reason
for return.
«•* Remaining steps are for proper invoices only.
(4) If the COR isn't using EASY, then RTP-FMC forwards the hard copy invoice
along with EPA Form 2550-19T (invoice approval form). A copy of the invoice will be attached
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in those instances where the contractor is not providing an advance copy to the COR.
(5) Provides appropriate follow-up with approving officials and their supervisors
to ensure return of the Form 2550- 19T.
(6) Receives EPA Form 2550-19T, along with EPA Form 1900-68, Notice of
Contract Costs Suspended and/or Disallowed (when amounts are recommended for
suspension/disallowance).
(7) Processes financial payment transactions and certifies undisputed amounts for
payment by the Department of the Treasury in accordance with timing requirements of the
Prompt Payment Act and the contract.
(8) If no costs are suspended by the COR, confirmation of invoice receipt and the
date of payment is provided to the CO and COR via a weekly e-mail report. In cases where there
are suspended or disallowed costs, confirmation of invoice receipt and the date of payment is
provided to the CO and COR confirming the information provided on the EPA Form 1900-68,
via a weekly E-mail report.
(9) Files the original of contractor invoice, Form 1900-68, Project Officer Invoice
Approval form, and any documentation supporting payment (such as CO award notification,
indirect rate agreements, and COR explanation of invoice approval/disapproval).
There is an extensive list of RTP-FMC points of contact, invoice-related policies,
procedures, and data available at http://intranet.epa.gov/ocfo/finservices/commercial 1 .htm.
16. Contracting Officer's Role in Invoice Review
a. General. CO works with COR and contractor to resolve any invoice questions that the
COR cannot resolve alone.
(1) CO has primary responsibility for specifying which invoice and monthly
progress report clause will be included in the contract.
(2) CO has primary responsibility for modifying the contract to include any
changes to Federal or Agency procurement policy.
(3) CO is responsible for performing periodic reviews, as needed, to ensure that
the contractor, CORs, and RTP-FMC, are fulfilling their roles properly, and for assuring that all
issues relevant to contract performance are being addressed.
(4) COs should perform at least one detailed review of an invoice on each contract
each year.
(5) The CO shares responsibility with financial administrative CO for resolving
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cost and financial issues raised during financial monitoring reviews.
b. Funding. CO has secondary responsibility for ensuring that the contract is sufficiently
funded.
(1) CO has secondary responsibility for ensuring availability of funds for payment
of invoice.
(2) CO shares responsibility with the COR and RTP-FMC for identifying and
deobligating excess funds from the contract.
(3) CO has secondary responsibility for reviewing monthly progress reports for
consistency with the invoice, adequacy of progress, funding issues, and to monitor key data (such
as costs per hour and ratio of prime to subcontractors). The COR has primary responsibility.
(4) CO has secondary responsibility to ensure sufficient explanation for costs
billed are provided so the COR can.evaluate invoiced costs.
c. Invoice Rates and Math. CO has secondary responsibility, and RTP-FMC has
primary responsibility, for verifying the use of correct indirect cost rates, as stated in the contract,
on invoices.
(1) CO has secondary responsibility, and RTP-FMC has primary responsibility,
for verifying the math of indirect cost calculations on invoices.
(2) CO should review correctness of indirect rates being billed at least once a year
for LOE contracts and fixed rates for ID/IQ contracts.
(3) CO should periodically verify use of the correct direct cost rates and assure
that rates which change at the end of each period are changed correctly, and verify that any other
conditions which result in recalculation, or adjustment of rates are implemented as specified in the
contract.
(4) CO should work closely with COR to ensure the use of correct revised rates
for prior periods.
(5) CO is responsible for modifying the contract to establish changes in labor and
equipment rates, and making sure RTP- FMC and the COR are aware of the changes.
(6) COs should forward modifications and indirect rate agreements which change
indirect rates from Financial Analysis and Rate Negotiation Service Center to CORs.
d. Suspensions/disallowances. CO involvement is mandatory in processing suspensions
which may lead to disputes with the contractor, including issues such as lack of authorization to
incur costs (such as overtime), unnecessary costs incurred, and where excessive costs are
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involved. COs have the full responsibility for all actions to disallow costs.
(1) CO works with COR and contractor to resolve suspension/ disallowance
issues.
(2) As appropriate, CO fills out the "Notice of Contract Costs Suspended and/or
Disallowed" form (Form 1900-68) and forwards it to the contractor, COR, RTP-FMC, and
applicable cost advisory office. A copy is retained for the contract file.
(3) The CO is responsible for following up on Form 1900-68 suspensions, and
disallowing costs where the contractor does not respond to the suspension within 60 days. The
CO completes the disallowance section of a copy of the previous Form 1900-68 and distributs it.
e. Contract Ceilings and Provisions. CO has secondary responsibility for confirming
compliance with contract cost ceilings at least once a year.
(1) CO should verify compliance with any special provisions of the contract (e.g.,
ODC limits, optional hours, technical direction, etc.) at least once a year. The COR is responsible
for tracking compliance using the monthly progress report during routine invoice processing.
(2) CO has secondary responsibility for verifying compliance of invoices and
monthly progress reports with contract requirements. The COR has primary responsibility.
f. Filing. CO shares responsibility with the COR and RTP-FMC for maintaining a
history of invoices submitted, payments, discounts taken, suspensions, disallowances, and
refunds. The CO maintains a record of audit requests, audit reports, negotiations, audit
resolution, and negotiated contract costs by fiscal period.
17. Points to Remember
a. If you're reviewing your first invoice from a particular contractor, conduct a thorough
review for format and level of detail. This makes the second and subsequent vouchers easier to
review and process.
b. Document your review of the invoice and MPR. Use the checklists to help you review
the invoice thoroughly. Ask questions if you don't understand some of the charges. Seek help
from your PO or CO.
c. Use EPA Form 1900-68 to document suspension of invoice charges. Keep in mind, the
COR can suspend questioned costs, but only the CO can disallow costs.
d. Payment to the contractor implies that work is progressing according to the contract;
it's up to the invoice reviewer to assure that the Government is getting what it pays for.
e. Invoice review must be completed with 30 days of the date RTP-FMC received the
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voucher. Agency policy requires an alternate COR, particularly to alleviate delays in the invoice
approval.
f. A spreadsheet to track costs incurred against the work assignment, or contract amount
helps with monitoring the contractor's expenditures under the contracts.
g. For additional information on invoice review, see your PO, CO, or read the Invoice
Review Guide available on the OAM Intranet.
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Appendix to Chapter 6
1. PO Checklist for Invoice Review 6-18
2. Work Assignment or Task Order COR's Checklist for Invoice Review 6-20
3. Sample Fact Sheet 6-21
4. Sample Work Assignment "Invoice" 6-22
5. EPA Form 1900-68 6-23
6. Rationale for Suspending Invoice Charges 6-25
7. Review Questions 6-26
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PO CHECKLIST FOR INVOICE REVIEW
This checklist is for a PO or Contract-level COR review of basic contract costs.
Invoice No.: Performance Period:
Contract No.:__, Contractor: Site:
Due to RTP-FMC on:
* Please provide written comments where necessary or where answers are "no"
VOUCHER OVERVIEW
Y
N
NA
1.
Does the contract period of performance (PoP) cover the voucher PoP?
[ ]
[ ]
[ ]
2.
Does the invoice period of performance cover the progress report PoP? [ ]
[ ]
[ ]
3.
Are all cost elements and cumulative amounts adequately shown?
[ ]
[ ]
[ ]
4.
Do all costs comply with appropriate contract provisions for payment
[ ]
[ ]
[ ]
restrictions/ceilings?
5.
Does it appear the contractor will remain within the estimated cost for all
[ ]
[ ]
[ ]
work assignments before the PoP expires?
6.
Has the CO issued work assignments for the period referenced
in the invoice?
[ ]
[ ]
[ ]
7.
Are specific costs (site and WA) correctly broken down,
accumulated and billed?
[ ]
[ ]
[ ]
8.
If negative performance has been evident, has the contractor been notified
and taken steps to correct the noted deficiencies?
t ]
[ ]
[ ]
9.
If this is an invoice for any previously suspended costs did they have
[ ]
[ ]
[ ]
permission to rebill it?
LABOR
10.
Are the labor categories and hours billed appropriate for the work required?
[ ]
[ 3
[ ]
11.
Does the level of effort include only appropriate direct labor from the
• [ ]
[ ]
[ ]
executive/clerical/support labor categories, and not labor which should
be included as an indirect cost?
INDIRECT COSTS
12.
Are indirect costs and rates billed at the authorized rates for that PoP
[ ]
[ ]
[ ]
as shown in the contract or the applicable indirect cost rate agreement?
OTHER DIRECT COSTS (ODCs) /FEES
13.
Are ODCs reasonable and within contract approved dollar ceiling?
[ J
[ J
[ ]
14.
Have all subcontracts for which costs are shown been consented
to by the CO?
[ ]
[ ]
[ ]
15.
Did photocopying quantities stay within the limits set by the contract?
[ ]
[ ]
[ J
16.
Is the base or fixed fee being billed accurately?
[ ]
[ ]
[ ]
17.
Did equipment purchases have prior CO approval?
[ ]
[ ]
[ ]
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PO CHECKLIST FOR INVOICE REVIEW (Continued)
I have reviewed the work assignment CORs' checklists (if applicable), this invoice, its supporting
documentation, and monthly progress report for this invoice. I agree that:
[ ] Direct charges appear to be reasonable, accurate, and commensurate with the level
of effort performed during this time period.
[ ] Charges in the amount of $ are questionable or not
adequately substantiated, and should be suspended. I have forwarded EPA Form
1900-68 and supporting documentation to the paying office, the CO, and the
contractor as specified in the instructions to the 1900-68.
COR Signature: DATE:
COMMENTS:
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Work Assignment'or Task Order COR's Checklist for Invoice Review
This checklist may be adapted to review work assignment or delivery/task order invoices.
Invoice No.: Performance Period: WA#:
Contract No.: Contractor: Site:
WAM Name: Due to Contract-level COR on:
Please provide written explanations when answers are "no"
VOUCHER OVERVIEW Y N NA
1. Are specific costs (site and WA) correctly broken down, accumulated,
and billed? [ ] [ ] [ ]
2. Does the invoice period of performance (PoP) cover the progress report PoP? [ ][ ] [ ]
3. Are the billed costs authorized by the work assignment/workplan or the contract? [ ][ ] [ ]
4. Is the math accurate? [ ][ ] [ ]
5. Are the accumulated costs and level of effort invoiced within the estimates [ ][ ] [ ]
of the approved workplan?
LABOR
6. Is the labor mix consistent with the workplan? [ ][ ] [ ]
7. Are the labor hours commensurate with work completed in PoP? [ ][ ] [ ]
8. Are the labor categories similar to the last PoP? [ ][ ] [ ]
9. If not, is there an appropriate rationale for the change? [ ][ ] [ ]
10. Were billed premiums for overtime authorized by the CO or allowable in the [ ][ ] [ ]
contract?
OTHER DIRECT COSTS
11. Was CO consent for any charges for subcontractors received in advance? [ ][ ] [ ]
12. Is the level of subcontract effort charged commensurate with the level of [][][]
progress made?
13. Do travel expenses appear reasonable and within the approved budget? [ ][ ] [ ]
14. Do supply and material costs appear appropriate for the tasks completed this [ ][ ] [ ]
month?
15. Did equipment purchase.have prior CO approval as required by property [ ][ ] [ ]
procedures?
14. If present, does the amount of ALL other direct costs seem reasonable and [ ][ ] [1
commensurate'with the work performed?
[ ] No exceptions are made to the invoiced amount for the work assignment and period of performance
reference above. I recommend paying $ on this invoice.
[ ] Exception is made to the invoiced amount. I recommend approval of $ . Exceptions are listed
below, or attached if more room is needed.'
Excepted Amount Reason for Exception:
Signature: DATE:
ADDITIONAL COMMENTS:
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[Last Updated xx/xx/xx]
for Option II Contract Period.
Sample Fact Sheet
(prepared by PO or CO)
CONTRACT NUMBER: 68-D3-0642 TYPE: CPFF LOE Term Contract
CONTRACTOR: ABC Company IMPORTANT: Asterisk * denotes
CBI (Confidential Business Info.)
POINTS OF CONTACT:
ABC Program Manager: Sheila Homes (703) 221-4321
EPA Contracting Officer: Mary Worker (202) 564-1234
EPA Project Officer: Peter Jones (202) 260-5555
CONTRACT PERIODS OF PERFORMANCE
Base Period - September 23, 200_ to September 30, 200_
Option I - October 1. 200_ to September 30, 200_
Option II - October 1, 200_ to September 30, 200_ — (current period)
Option III - October 1, 200 to September 30, 200_
Option IV - October 1, 200_ to September 30, 200_
Total Direct Labor Hrs. LOE Hrs. Est. Cosf Fixed Fee*
Option II Period 16,000 15,531 $851,015 $62,124
Average cost per LOE hour = $58.21* (no fee) Fee per LOE hour = $4.00*
INDIRECT COST BILLING RATES*:
Fringe Benefits 25%* (of Direct Labor only)
Overhead 75%* (of Direct Labor plus Fringe)
G & A 10%* (of Total Costs excluding G&A)
Contract Ceilings:
Travel (needs CO approval) NTE $50,000
Other Direct Costs NTE $85,000 (including travel costs but not subcontracts)
SUBCONTRACTORS CONSENTED to bv CO
DEF, Incorporated 2,000 LOE hours NTE $120,000 (CPFF)
CONSULTANTS CONSENTED to bv CQ
Dr. Amy Rutgers 200 LOE hours @ $80 per hour NTE $16,000
Other Contract Notes:
Contractor to begin work immediately upon receipt of work assignment issued by CO.
All work assignments need contractor work plan within 15 calendar days. Work plans
reviewed and recommendation thru PO to CO within 15 calendar days.
Monthly progress report due 10th of each calendar month (invoice covers same period).
Attached is copy of Contract Basic SOW please make sure your project SOWs reference all
specific work areas in Basic SOW.
Attachment: Basic Contract SOW
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Sample "Invoice" - Work Assignment Level
Contract Number 68-D0-0123
Supporting Schedule for Work Assignment 03-03
Billing Period: October 20-November 19, 2003
Item
Cost Element
Hours
Average Rate
(current)
Current Amount
Cumulative amount
Direct Labor (DL)
P-4 Program Manager
48
$45.00
$2,160.00
$8,800.00
P-3 Senior Chemist
192
S27.50
$5280.00
$25,326.00
P-2 Toxicologist
8
$18.50
$148.00
$608.00
Clerical
20
$16.50
$330.00
$1,430.00
1
Total DL
268
$7,918.00
$36,164.00
2
Fringe Benefits @ 30% of Item 1
$2,375.40
$10,849.20
3
Subtotal
$10,293.40
$47,013.20
4
Overhead @ 40% of Item 3
$4117.36
$18,805.78
5
Other Direct Costs -
Subcontracts
0
0
Consultants
0
0
Travel
0
0
Equipment
0
0
Other -
Computer Time
$187.00
$654.50
Local Travel
$56.75
$283.75
Postage/Shipping
$107.60
$484.20
Reproduction
$110.47
441.88
Telephone/Fax
$58.28
$290.40
Miscellaneous
0
$171 65
6
Subtotal
$14,930.86
$68,145.36
7.
G& A @ 12% of Item 6
$1791.70
$8,177 44
8.
Total Costs (1-8)
$16,722.56
$76,322 80
9.
Fee at S4.25/L0E Hours
(LOE = 248 hours)
$1,054.00
$4,972 50
10.
INVOICE TOTAL
$17,776.56
S81,295.30
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E?A
United States Environmental Protection Agency
Washington, D.C. 20460
NOTICE OF CONTRACT COSTS
SUSPENDED AND/OR DISALLOWED
PAGE |—, OF —-, PAGES
TO: (Name and Address of Contractor)
Contract Number
Date
Delivery Order Number (if applicable)
Voucher Number Reference
1. SUSPENDED COSTS, as referred to herein, are costs which, for the reasons stated below, have been determined by the undersigned to be inadequately supported
or otherwise questionable, and not appropriate for reimbursement under the contract terms at this time. Such costs may be determined reimbursable after the
contractor provides the Contracting Officer and/or Project Officer additional documentation or explanation as specified below.
2. DISALLOWED COSTS, as referral to herein, are costs which, for the reasons stated below, have been determined by the undersigned to be unallowable, that is,
not reimbursable under the contract terms.
3. This notice must be responded to by the contractor within 60 days of issuance. Any suspended costs will become disallowed if the contractor does not respond in
the time allotted. These disallowed costs should be removed from the contractor's accounting records for this contract.
4. The contractor may not rebill any suspended costs on this form until notified by the Contracting Officer and/or Project Officer on this contract that the suspension
has been lifted.
5. If the contractor disagrees with this/these determinations, the contractor may (1) request in writing the cognizant contracting officer to consider whether the
unreimbursed costs should be paid and to discuss their findings with the contractor and /or (2) file a claim under the "Disputes" clause of the contract.
6. Copies of this Form 1900-68 should be distributed to the Contracting Officer, Project Officer, RTP Finance, and the applicable Cost Advisory Office.
A. COST SUSPENSION 1 Date of Notice
Invoice Number
Contracting Officer or
Project Officer
Name and Title of Authorized Official
Signature
ITEM
Description of Items and Reason for Action, Documentation Needed ui order to rebtU suspended costs.
Amount ot Costs
B. REM<
DVAL OF SUSPENSION Date <" Nou«
Invoice Number
Contracting Officer or
Project Officer
Name and Title of Authorized Official
Signature
rTEM
Description ot Items and Reason for Action
Amount of Costs
C. DISALLC
>WANCE OF COSTS Date <" *«¦«
Invoice Number
Contracting Officer
Name and Title of Authorized Official
Signature
ITEM
Description of Items and Reason for Action
Amount ot Costs
CONTRACTOR'S ACKNOWLEDGMENT OF RECEIPT - The contractor or its authorized representative shall acknowledge receipt of ibis notice to the Project
Officer and/or Contracting Officer.
Date of Notice
Name and Tltle of Authorized Official
Signature
EPA Form 1900-68 (Rev. 05-95)
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INSTRUCTIONS FOR EPA FORM 1900-68
Notice of Contract Costs Suspended and/or Disallowed
(See form below)
When a COR or CO identifies costs in a voucher that are to be suspended or disallowed, the Form 1900-68 is used
to identify those costs, the associated reasons and to communicate the action to all necessary parties. Examples of
costs that a COR might suspend without CO involvement are: math errors, incorrect rates, and a lack of available
funding. Examples of costs that CO involvement would be necessary to suspend or disallow costs include lack of
authorization to incur cost, unnecessary costs incurred, and excessive costs. Section A, Cost Suspension, may be
filled out by either the CO or COR. The COR and/or CO must fill out the Form 1900-68 explaining the suspended
amount, sign and date the Form and send it to the contractor. The contractor must fill out the acknowledgment of
receipt on the applicable area on Form 1900-68 and return a copy of it to either the COR or CO who made the
suspension. A copy of the Form 1900-68 would go to RTP Finance with the Approval Forms package. Copies of
the Form 1900-68 would be filed by COR and/or CO and a copy sent to the applicable Financial Analysis Service
Center in OAM (3802R) for use in interim and final audits.
The Form 1900-68 states that the contractor has 60 days to respond to the suspension, or the costs will be
considered disallowed and those costs should be transferred to an unallowable account in the contractor's accounting
records. If the contractor wishes to respond to the suspension, it must at a minimum furnish documentation
specified on the Form 1900-68 for the costs to be considered allowable. The contractor will then resubmit this
documentation to the COR and CO for review. Either the CO or COR who originally suspended the costs will
consider the documentation and, if it is adequate, they will fill out Block B of the same Form 1900-68. (Removal of
Suspension) for some or all of the costs suspended. Copies of this revised Form 1900-68 would go to the
contractor, CO and COR, RTP FMC, and the Financial Analysis Service Center in OAM (3802R).
The contractor may rebill suspended costs after receiving the Removal of Suspension using a separate invoice and
attach the Form 1900-68 Removal of Suspension notice to the invoice.. The contractor must then resubmit this bill
for payment in accordance with contract invoicing requirements.
If the contractor prepares supporting documentation for suspended costs that the COR deems unacceptable, the
COR will notify the CO of this and ask for a final determination on the allow ability of the costs. If the CO agrees
with the COR, a revised Form 1900-68 with Block C (Disallowance of Costs) should be completed and sent to the
contractor instructing the contractor to eliminate such costs on future invoices and to move such costs to
unallowable accounts on their accounting records. The contractor must acknowledge receipt of the disallowance
notice by signing and returning the notice to the CO. Where the CO processed the suspension, the CO will inform
the COR and disallow the cost. Copies of the revised Form 1900-68 should be sent to RTP Finance, the contract
file, and the.applicable the Financial Analysis Service Center in OAM (3802R).
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SAMPLE RATIONALE FOR SUSPENDING INVOICE CHARGES
(this would be attached to the Form 1900-68)
Pg. 1 of pgs.
Invoice No. Date of Invoice: Contractor:
Contract No. Work Assignment or Task Order No.
COR's Name: Phone No. Fax No.
Suspended Costs are as follows:
DIRECT LABOR
20 direct labor hours charged by Corporate Vice-president
@ $50/hour
Not in accordance with approved work plan
$1,000.00
8 hours of overtime for secretary @ $20/hour for typing draft report due
Monday, March 3, 1997
Not authorized in advance by CO.
$160.00
Total direct labor deductions
$1,160.00
OVERHEAD
Associated overhead on above DL @ contract rate of 100%
$1,160.00
Subcontract costs for DEF Corporation exceed contract ceiling ($50,000 max.); billing
thru this invoice totals $50,551 overage amount deducted.
$551.00
All travel costs totaline $5,100 which were not sufficiently broken down in specific detail
to permit review as required by contract invoicing instructions.
$5,100.00
Subtotal of deductions
$7,681.00
GENERAL AND ADMIN. EXPENSE
Associated G&A on the above costs @ contract rate of 10%
$ 768.10
FEE
Prorated fee on the above DL hours counted as LOE hour
20 hours, for V.P. times $4.00 per LOE hour
$80.00
GRAND TOTAL DEDUCTIONS
$8,848.10
RECAP:
Total Invoiced on this WA this month $40,341.45
less deductions of $ 8,848.10
Balance recommended to be provisionally paid $31,493.35
Signed: Date:
(Signature of COR)
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REVIEW QUESTIONS
Carefully read the following questions on invoice procedures. Mark "T" for true or "F" for false,
as appropriate.
~"f 1. The contractor's invoice contains confidential business information which the
COR must protect from disclosure.
f
2. Effective January 2, 2003, supervisors will be required to approve invoices in the
absence of the COR.
Y 3. It is the sole responsibility of the CO to ensure that the contractor does not exceed
any of the cost ceilings stated in the contract.
4. The COR should monitor the use of LOE hours and report underutilization to the
CO.
_]F_5. Equipment and subcontractor costs do not require any prior approvals.
~C 6. The COR is responsible for determining which contract costs are considered
reasonable from a technical standpoint.
T
Fs.
1
You should question if the contractor charges directly for employee training
classes without the CO's prior approval.
Miss Bennett is the Vice President of Pemberley, Inc. She is performing senior
chemist work under a work assignment, but the firm is charging, her hours at the
vice presidential rate. Since she is the Vice President, then the COR should not
question this cost.
9. The contractor is not entitled to overhead, G&A, and fee on suspended costs.
10. The CO is responsible for the bulk of the invoice review function.
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Chapter 7: Establishing Project Files and Handling Sensitive Information
1. Introduction
The maintenance of complete and accurate project files is essential to managing all
contractor work. This chapter elaborates on the major reasons for maintaining complete project
files, describes the major categories of documents that the Contract COR and other CORs should
maintain, and lists the individual items within each category, and the appropriate retention and
disposition of project records. This chapter discusses close out and the procedure involved in
closing out a work assignment. This chapter concludes with a discussion of handling sensitive
information.
2. Importance of Maintaining Records
All government employees and contractors are required by the Federal Records Act to
make and preserve records and information which document the Agency's functions, policies
decisions, procedures, and essential transactions. In addition, Federal regulations provide that
these records must be properly stored, and preserved, available for retrieval, and subject to
appropriate approved records retention control schedules. Your contract management files are
official Agency records and must follow these guidelines and comply with Agency record
keeping requirements.
At a minimum your contract files should provide an audit trail of the actions taken under
the contract, work assignment, task or delivery order. These files should be maintained using a
system which is consistent, easily retrievable, and properly safeguarded. Your files should be
maintained in a manner that would allow someone taking over your COR duties to ascertain
which deliverables have been accepted, if any deliverables are late, how much money remains on
the order, a history of technical direction, and so forth. Keep in mind yourfiles are subject to
audit by officials within the Agency, such as the Office of the Inspector General, or outside the
Agency, such as the General Accounting Agency. Certain documents (not all of them) may be
released to outside parties under the Freedom of Information Act ("FOIA"). Thus, it is very
important that your files be accurate and current.
Basically, your major records would fall into one of the following categories:
1. Procurement initiation package (the documents sent to the CO to award the contract or issue a
work assignment)
2. Contractor's work plan and comments on it
3. Contract, work assignment, etc. signed by the CO and any modifications and amendments
4. Documentation of technical direction
5. Invoices and monthly progress reports and record of your review
6. Correspondence related to the contract or order
7. Deliverables and record of your review
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The CO has the ultimate responsibility for maintaining contra^ ™»rnrHg He or she may
delegate the responsibility for some records to the contract COR who may, in turn, delegate
responsibility for maintaining certain records to the CORs for the WA/DO/TO issued under the
contract. Close coordination between the all of the CORs on the contract is necessary to ensure
that all appropriate records are maintained.
A more detailed Sample File Plan is attached to this chapter.
3. Length of Time Records Should be Maintained
Upon completion of the work assignment task project, the COR should coordinate with
the Project Officer for storage of the files, i.e., where the files should be stored and who should
maintain them. Since an employee may be reassigned during or after a WA, TO or DO, the files
should be identified and remain with the office, service center, or laboratory, as the case may be,
rather than with an individual.
The records schedule for acquisition management requires the Agency to maintain
individual contract records 6 years and 3 months after final contract payment, then they can be
destroyed when no longer needed unless related to Superfund contract management. (See
Agency-wide Guidance at http://intranet.epa.gov/records'). During this time period of retention,
the schedules permit the records to be stored either in the program office or the Federal Records
Center; however, since the FRC requires a destruction date, the records may be retired to the
FRC only after contract close-out, or after a destruction date has been estimated. Thus, records
for contract-related work performed early in the life of a five-year contract, would need to be
retained for over 11 years plus the time for contract close-out.
Contract records which are Superfund Site-Specific (i.e., related to cost recovery) have a
longer retention period. Such records are to be kept, in the program office or the FRC, for 30
years from the expiration of the project.
4. Contract Closeout
A contract is considered complete when 1) all deliverables have been delivered and
accepted, or 2) all required services have been performed and accepted, and 3) the period of
performance, including all option provisions which have been exercised have expired. Contracts
that are physically complete must be administratively closed out, which involves the settlement
of all outstanding contractual issues and the documentation of the file. The Contracting Officer
is responsible for closing out the contract with the assistance of the Project Officer.
5. Closeout Procedures
The contract closeout process encompasses all those actions required to see that the
Government has received the goods or services under contract, the contractor has been paid the
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correct amount, Government property is accounted for, all required reports have been received
and the file is properly documented and transmitted to the records center.
The Federal Acquisition Regulations set forth the following time standards for closing
out contract files:
A. Firm Fixed Price Contracts - 6 months from the date on which the Contracting Officer
receives evidence of physical completion.
B. Cost Reimbursement and Contracts Requiring Settlement of Indirect Cost Rates -36
months from the date on which the Contracting Officer receives evidence of physical completion.
C. All Other Contracts - 20 months from the date on which the Contracting Officer
receives evidence of physical completion.
Timely closeout of contracts is important because there might be payments due the
contractor, and EPA's financial accounts need to be closed out. Excess funding must be returned
to the Treasury Department, typically because closeout occurs so long after funding that excess
funds cannot be deobligated and reprogrammed for use at EPA. Also, allowing completed
contracts to remain open can generate late claims and disputes.
After all costs have been incurred under a cost-reimbursement contract, and /or items
delivered, the contractor will submit a completion voucher, summarizing all costs claimed
throughout the contract period. (This step is not necessary for firm fixed price contracts, as the
voucher submitted after the items are accepted will specify the fixed price of the contract and
contractor costs are irrelevant.) The contract level COR will be requested to examine the
voucher from the perspective of (1) was the work performed and (2) are the costs allocable and
reasonable.
The completion voucher serves as the basis for requesting a final audit, which will
provide to the Contracting Officer a report on the contractor's actual costs and serves as the basis
for negotiating a final cost settlement. The Contracting Officer must then determine the
allowability, allocability, and reasonableness of costs claimed and may enter into negotiations
with the contractor. A final cost is then negotiated and final payment can be made. The final
voucher submitted by the contractor is certified by the Contracting Officer (not the contract-level
COR) and is subject to all provisions fo the Prompt Payment Act. Other requirements of
closeout of completed contracts are:
- proper disposition of Government property
- release of all future claims from the contractor
- proper disposition of any classified material
- disclosure of all inventions
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6. COR Responsibilities During Closeout
CORs will be requested to assist in part of the contract closeout process. Listed below
are the tasks the COR normally will be responsible for performing:
1. Certifying that all technical requirements of the contract have been satisfied, that the
products or services have been satisfactorily completed within the contract amount, and that the
final report and all deliverables have been received and accepted.
2. Reviewing and determining the accuracy of the contractor's reporting of inventions
3. Examining the completion voucher (on cost reimbursement contracts)
4. Evaluating the contractor's performance under the contract.
Most of these activities will be requested by the Contracting Officer in writing, so the
contract level COR need only respond to the written request. Nonetheless, it is essential that the
tasks be performed as quickly as possible, as contract closeout is a time-consuming process and
many steps are dependent upon completion of the preceding steps. Contract level COR must
take care to be responsive to these request, as their duties as CORs do not end until contract
closeout is completed.
It is essential that contractor evaluations be well thought out by the contract level CORs
and backed up by documentation. These evaluations can later serve as the basis for evaluating
past performance of a potential contractor in consideration for award of future requirements.
Good or bad experiences can be used by the Contracting Officer and thus enhance EPA's
acquisition program in later years.
Handling Sensitive Information
7. What Can I say and When can I Say It?
Before you submit your PR or PIN to the CO, you are in the phase of the contract process
where requirement has not been defined, therefore, disclosure of procurement-sensitive
information is not an issue. Thus, the COR can have a detailed discussion of approaches and
potential solutions with industry. This is addressed in FAR 15.201(f), which states, "General
information about agency mission needs and future requirements may be disclosed at any time."
The CO need not be a part of market research at this point. Once a PR or PIN is submitted to the
contracting office, the following rules apply:
(1) Each potential offeror must be treated impartially;
(2) Information made available to one potential offeror shall be made available to
the public as soon as practicable in order to avoid creating an unfair competitive advantage; and
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(3) You cannot disclose information that is sensitive or confidential.
Hence it is crucial that the CO be the focal point of any exchange with potential offerors.
8. Information Published on the Internet
a. If you receive a call from a firm which is interested in doing business with the Agency
and it is apparent that the caller has not visited the Agency web site, refer the caller to
http://www.epa.gov/oam/. The website provides a wide variety of information on the Agency's
future acquisition requirements, current contracts, opportunities for small business, and so forth.
General information, spanning the entire Government, is available at the Federal Business
Opportunities or "FedBizOpps" at http://www.fedbizopps.gov.
b. The U.S. Small Business Administration developed Pro-Net! as an electronic gateway
of procurement information for and about small businesses. It is a search engine for contracting
officers, a marketing tool for small firms and a "link" to procurement opportunities and important
information. It is designed to be a "virtual" one-stop-procurement-shop. Businesses profiled on
the Pro-Net system can be searched by NAICS codes; key words; location; quality,
certifications; business type; ownership race and gender; EDI capability, etc. This internet site is
http://pro-net. sba. gov/.
c. Prime contractors use the U.S. Small Business Administration Subcontracting
Network or "SUB-Net" to post subcontracting opportunities. These may or may not be reserved
for small business, and include either solicitations or other notices, such as, notices of sources
sought for teaming partners and subcontractors on future contracts. Small businesses can review
this web site to identify opportunities in their areas of expertise. While the web site is designed
primarily as a place for large businesses to post solicitations and notices, it is also used by
Federal agencies, state and local governments, non-profit organizations, colleges and
universities, and even foreign governments for the same purpose. The internet site is
http://web. sba. gov/subnet/.
9. Other Information Which You May Disclose
a. The following examples of types of information are publicly available and are not
entitled to confidential treatment.
(1) Information of a general nature about a contractor that the contractor routinely
publishes or discloses to the public as part of its regular business activities.
(2) Information reproduced from documents that are already public, such as
RFPs, other EPA documents, or published materials.
(3) The aggregate costs (total of all costs and fees) of the contract to the
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Government. You may disclose the total price by option year, but do not disclose unit prices.
(4) Information that is developed by the Government which has been made
public.
(5) The identity of the incumbent contractor.
10. Types of Confidential Information
a. The following categories cover types of information which all Agency employees
must protect.
(1) Confidential Business Information (CBI). CBI includes information the
regulated community or contractors submit to the Agency. It encompasses trade secrets,
proprietary, commercial, financial, and other information that is afforded protection from
disclosure under certain circumstances as described in the Trade Secrets Act, the Freedom of
Information Act (FOIA), and so forth. Many Agency programs, such as the Clean Water Act or
Clean Air Act, have specific CBI regulations which control the treatment of CBI obtained
specific environmental statutes.
(2) Confidential Agency Information (CAI). CAI includes all internal
information that, if disclosed to unauthorized individuals, could harm EPA's employees,
property, or operations. This covers both pre-award and post-award contract information, such
as cost estimates for contracts or work assignments.
(3) Privacy Act Information and Other Personal Information. Information
covered by the Privacy Act includes groups of records about individuals under the control of an
agency from which information is retrieved by the name of the individual or by some identifying
number, symbol, or other identifier assigned to the individual, e.g., the EPA Payroll System.
Personal information is also protected under FOIA Exemption 6, which generally interpreted as
protecting all personal information, unless an individual's right to privacy is outweighed by the
public's interest in obtaining the information.
(4) Enforcement-Confidential Information. Enforcement-confidential
information includes information about criminal, civil, and administrative proceedings. If
released, this information could reveal the Agency's enforcement targets, strategies, or sources of
information.
11. Pre-Award Contracts Information Which Must Be Protected
a. This section involves information you may have access to if you are part of a
technical evaluation panel or otherwise involved in the pre-award process. Please note that this
information does not become public once the contract is awarded. Other laws such as the Privacy
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Act and the Trade Secrets Act may preclude release of information both before and after contract
award.
(1) Source Selection Information. "Source selection information" means any of
the following information that is prepared for use by an agency for the purpose of evaluating a
bid or proposal to enter into an agency procurement contract, if that information has not been
previously made available to the public or disclosed publicly:
(a) Bid prices submitted in response to a Federal agency invitation for
bids, or lists of those bid prices before bid opening.
(b) Proposed costs or prices submitted in response to a Federal agency
solicitation, or lists of those proposed costs or prices.
(c) Source selection plans.
(d) Technical evaluation plans.
(e) Technical evaluations of proposals.
(f) Cost or price evaluations of proposals.
(g) Competitive range determinations that identify proposals that have
a reasonable chance of being selected for award of a contract..
(h) Rankings of bids, proposals, or competitors.
(i) Reports and evaluations of source selection panels, boards, or
advisory councils.
(j) Other information marked as "Source Selection Information-See
FAR 2.101 and 3.104."
(2) "Contractor bid or proposal information" means any of the following
information submitted to a Federal agency as part of or in connection with a bid or proposal to
enter into a Federal agency procurement contract, if that information has not been previously
made available to the public or disclosed publicly:
(a) Cost or pricing data.
(b) Indirect costs and direct labor rates.
(c) Proprietary information about manufacturing processes, operations,
or techniques marked by the contractor in accordance with
applicable law or regulation.
(d) Information marked by the contractor as "contractor bid or
proposal information" in accordance with applicable law or
regulation.
(e) Information the contractor has marked as restricted in accordance
with FAR 52.215-1(e).
12. Other Contracts-Related Information Which Must Be Protected. The following are
examples of information which must be protected, unless otherwise publicly available and
disclosure of the information is not otherwise required by statute or regulation. These examples
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are NOT all inclusive.
a. Information that would disclose a firm's proposed approach to performing
contract work, such as a contractor's work plan.
b. Information that would disclose a firm's plan to manage the contract, including
plans to subcontract for performance of contract work.
c. Information concerning a firm's relevant experience and expertise, except for
general information regarding the firm's Government-sponsored contracts or grants that is public
information. (This includes a firm's past performance information.)
d. Information concerning the identities or qualifications of specific employees,
consultants, subcontractors, and subcontractor employees that a firm proposes to use in
performing the contract work. Information that would disclose the identities of key employees,
subcontractors and consultants utilized in performing contract work. Information that would
associate the identities of specific employees with the amounts, nature, and costs of work
performed by them.
e. Information concerning a firm's proprietary processes, devices, software,
organization of reports, analyses, etc.
f. Information concerning a firm's financial structure.
g. Information concerning a firm's accounting methods.
h. Information that would disclose a firm's labor rates, salaries, overhead costs,
general and administrative costs, fee or profit.
13. Specific Responsibilities of CORs
a. CORs must:
(1) Ensure specific information security requirements and plans for protecting
confidential information and sensitive data from inappropriate disclosure are identified in
acquisition documents (procurement initiation notices, contracts, delivery orders, task orders,
work assignments, or purchase orders).
(2) If contractor access to confidential information or sensitive data is required
for contract performance, determine if it is authorized by the contract and ensure that the
conditions of disclosure are met prior to issuing the tasking document.
(2) Ensure contractors comply with Agency and Federal information security
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requirements.
(3) If applicable, ensure contractor personnel have the appropriate level of
required background screening and are aware of their information security responsibilities.
(4) Ensure Agency mechanisms and controls to enable data base access and
communication, such as user IDs and mailing lists, are established, accurate, and current to
prevent unauthorized or unnecessary access to or disclosure of information.
14. Guidance on Protecting Sensitive Information.
a. This chapter briefly covered sensitive information you may handle while serving as a
COR. For more in-depth guidance, please see the following:
(1) The Office of Acquisition Management's guidance entitled, A Program
Manager's Guide for Communicating with Industry, dated September 4, 2001. The guide is
available on the intranet at http://intranet.eDa.gov/oamintra/policv/index.htm.
(2) The Computer Security Act of 1987 (P.L. 100-235) requires mandatory
periodic training for all persons involved in the management, operation, and use of Federal
computers systems that contain sensitive information. ("Periodic" training is interpreted to be
annually and "as needed".) Extensive information security guidance is available at
http://cfint.rtpnc.epa.gov/ntsdweb/securitv/index.cfin.
(3) The Office of Information Collection has developed the Information
Sensitivity Compendium to will help you:
(1) determine the sensitivity of the information you handle,
(2) identify information that must be protected from unauthorized disclosure,
(3) take steps to protect this information, and
(4) find more information and assistance.
The Compendium is available at http://intranet.epa.gov/oicwebsi/wi.htm.
15. Consequences of Inappropriate or Unauthorized Use of Sensitive Information
Depending on the severity of violation, and at the discretion of management
through due process of law, consequences of inappropriate or unauthorized use of sensitive
information may include: 1) suspension of computer access privileges, 2) reprimand,
3) suspension, 4) demotion, 5) termination, as well as 6) criminal and civil penalties.
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Appendix to Chapter 7
Document Page Number
1. Sample File Plan 7-11
2. Sensitive Information Student Exercise 7-1 7-13
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Sample File Plan
1. Statement of work and related information such as Contractor reporting requirements for the
contract1
2. Quality Assurance Program Plan for the contract1
3. WA, DO or TO package
- Procurement Request (EPA Form 1900-8)
- Statement of Work
- Independent Government estimate and worksheets
- COR Nomination and Appointment Form (EPA 1900-65)
- COR Appointment Memo
- Training Deferment Request and Approval
- Office of Environmental Information, Office of Policy and Planning Division for IT
hardware and software related effort.
- Office of Environmental Information Review and Approval if public information
collection (ICR) from 10 or more individuals is involved
- Office of Environmental Information for Quality Assurance Review forms (as needed)
- Justification of Need for GFP and copy of Deviation
- Intra-agency funding request and approval
- Justification and approval for Sensitive and/or Vulnerable Services (if needed)
- Conflict of Interest Determination
- Non-duplication of effort statement
4. Contractor's staffing, management, cost proposal and any required Government notice of
approval
5. Amendments to the work assignment/Modifications to the Task/Delivery Order
6. Technical direction documents
7. Combined Monthly Technical/Financial Progress Reports
8. Invoices and invoice reviews
9. Other special technical/financial reports
10. Financial tracking reports
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11. Deliverables and related correspondence (approvals, rejections, comments)
- Draft deliverables
- Final deliverables
12. Inventory of GFP (list and description)
13. Correspondence
- Letters
- Records of meetings and telephone discussions
- Memoranda for the record
14. Evaluations of Contractor performance
- Past Performance Evaluation input for database
- Cost Plus Award Fee (CPAF) Evaluation Forms
- Peer Reviews
- Other Evaluations and /or Reports as required
15. Administrative information (applies to all work assignments)
- Agency/program regulations/orders, directives, memoranda
- Agency/program reports on contract management
- Contract Management plan for the overall contract, including Management Controls
1 Although these items pertain to the overall contract, as opposed to an individual requirement,
the COR should retain these in his/her files. If the COR manages multiple tasking/ordering
projects under a given contract, these items might be kept in a separate file instead of the
individual WA, DO or TO file.
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Sensitive Information
Student Exercise 7-1
Bradley Headstone is a COR who is administering a large information technology contract with
Profit Inc. The contract will end in a year, so Bradley is also working on the PIN for the follow-
on requirement. How should Bradley handle the following calls he gets on a busy Monday?
1. The Washington Post is doing a story on Profit, Inc. A reporter wants to know the amount of
the Agency's current contract with the firm.
2. A small business calls and asks if EPA will be recompeting the Profit, Inc. contract and if
there are any subcontracting opportunities. The firm is also interested in the upcoming
procurement's conflict of interest strategy and how it may affect possible teaming arrangements.
3. Wiley Contractor, Inc. calls to ask if the Agency is satisfied with Profit, Inc.'s past
performance.
4. Bradley's wife calls to say her firm is looking for people with information technology
experience. She asks for a list of subcontractors and key personnel used by Profit, Inc.
5. The Information Technology Association calls to invite Bradley to their annual conference to
discuss EPA's plans for the follow-on procurement. Bradley plans to attend and bring the
acquisition forecast description of his requirement with draft performance specifications to,hand
out to conference attendees.
6. A small, disadvantaged business calls to make an. appointment to discuss their ability to meet
the Agency's needs for the follow-on contract.
7. In an effort to set up an efficient mechanism for obtaining software licenses, Bradley plans to
visit several commercial companies like Oracle and Microsoft in order to determine what
business practices they use. Discussions will center on commercial practices and cost-effective
means of acquiring software licenses.
7-13
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