Webinar: Making the Right Choices in Government Contracting Introduction

Public Contracting Institute LLC Webinar: Making the Right Choices in Government Contracting Introduction Presented by Richard D. Lieberman, FAR Consultant, Website: www.richarddlieberman.com, Email rliebermanconsultant@gmail.com. Mr. Lieberman is a procurement consultant and retired government contracts attorney. He is the author of eight books including The 100 Worst Government Mistakes in Government Contracting,; The 100 Worst Mistakes in Government Contracting (with Jason D. Morgan), and Elements of Government Contracting. His published articles include 10 Big Mistakes in Government Contract Bidding, 10 Big Mistakes in Government Contract Administration, Incorrect Government Advice Whom Should You Heed and The Ten Big Mistakes Made by Small Businesses and New Government Contractors. Mr. Lieberman is a former Deputy Inspector General and Assistant Inspector General of the Department of Defense. He served as a Professional Staff Member of the Senate Appropriations Committee. He has taught government contracts courses for the Public Contracting Institute, Federal Publications Seminars, LLC, the George Washington University Law School, the University of Maryland and numerous military, aerospace and information technology contractors. Lieberman 1

Dick Lieberman s contact information is as follows: Lieberman 2

What do Intelligent People Say About Incorrect Choices? A man's mistakes are his portals of discovery. - James Joyce Experience is the name everyone gives to their mistakes. - Oscar Wilde Anyone who has never made a mistake has never tried anything new. - Albert Einstein All men make mistakes, but only wise men learn from their mistakes. - Winston Churchill The only man who never makes a mistake is the man who never does anything. - Theodore Roosevelt Even a mistake may turn out to be the one thing necessary to a worthwhile achievement. - Henry Ford Lieberman 3

Why do people make bad choices? Incomplete knowledge you make decisions without knowing all the relevant facts Poor communication you fail to share all necessary knowledge that you have with decision makers Changing conditions you make a decision based on today's information but it may turn out to be wrong tomorrow Pressure -- you make bad choices when you make decisions too quickly or when under stress Complexity -- systems can become so complicated that the developers or users cannot keep all the details straight. The human mind has certain limits, and when exceeded, you make bad choices Lieberman 4

The Most Likely Reasons In Government Contracting Poor training An unwillingness to learn from prior bad choices that you made An unwillingness to learn from bad choices that someone else described to you Lieberman 5

Bad Choices in Government Contracting People are overly focused on rules and regulations It takes a pragmatic approach If you knew you would burn your hand if you put it on a hot stove, you wouldn t put it there! What is the first thing you think about when confronted with a new problem (has it been solved before?) Today s webinar covers some of the worst choices, and you should attend the other sessions in order to obtain the maximum benefit. Lieberman 6

Government Contracts Lifecycle where errors take place Lieberman 7

Question You have a contract to deliver traffic cones. The specifications say: made out of ¼ vinyl, 2 feet high, top is a 3 circumference, base is 12 X 12 and contains a 4 reflective stripe starting at 2 down from the top and running to six inches. This is a not-to-scale picture of the cone. This contract incorporates by reference specification 9-22 GSA, Traffic Cone, with the same force and effect as if given in full text. Your cones are delivered in unpainted cardboard boxes, meet the exact specifications listed on this slide, and are rejected. Why? Lieberman 8

Answer to Question This is what specification 9-22, GSA Traffic Cone, says: 9-22 GSA: The cone must be made out of ¼ vinyl, 2 feet high, top is a 3 circumference, base is 12 X 12 and contains a 4 reflective stripe starting at 2 down from the top and running to six inches. This is a not-to-scale picture of the cone. Each cone must be delivered in a cardboard box painted fully with day-glo (GSA 15) orange paint and distinctly marked GSA Traffic Cone, Specification 9-22 in 100 point type. If your cones are not delivered in the proper box they should be rejected. Lieberman 9

Reading Remember to read the entire solicitation, including all clauses incorporated by reference. This contract incorporates one or more clauses by reference, with the same force and effect as if they were given in full text. Upon request, the Contracting Officer will make their full text available. Also, the full text of a clause may be accessed electronically at this/these address(es): [Insert one or more Internet addresses]. FAR 52.252-2 Clauses Incorporated by Reference. (FEB 1998) Lieberman 10

Reading If everything else fails, read the instructions - Anonymous Be sure to follow the solicitation s submission instructions Example: Page limits While Techsys argues that [Department of Energy] should have been more flexible in the handling of the page limitation [150 pages], an agency that has set out a clear page limitation in a solicitation is not obligated to sort through hundreds of pages to decide which pages should or should not be counted toward that limitation. []. Further, where, as here, the agency has set specific page limits and indicated that any and all pages submitted would count toward that limit, the agency was not obligated to ask the offeror, after submission of its proposal, to "clarify" its proposal by selecting which pages it wants counted. []. Under these circumstances, the agency reasonably computed the 150 pages and properly declined to consider those portions of Techsys's proposal that exceeded the stated limits. B-278904.3 Lieberman 11

Sample Section L: Instructions to Offerors Proposals shall be submitted as two (2) separate documents, as follows: Documents Original Copies Solicitation, Offer and Award Document 1 2 Technical Proposal 1 2 The originals shall be clearly identified as the ORIGINAL, and bear the original signature(s) of the offeror. The copies shall be complete and clearly identified as COPY or DUPLICATE. Lieberman 12

Timing Timing and arrogance are decisive factors Marya Mannes Always submit your bid/offer on time Any proposal, bid, modification, or withdrawal of a bid received at the Government office designated in the solicitation after the exact time specified for receipt of bids is "late and will not be considered, unless FAR 14.304, FAR 15.208 A hand-carried proposal that arrives late may be considered if improper government action making it impossible for the offeror to deliver the proposal on time was the paramount cause for the late submission, and where consideration of the proposal would not compromise the integrity of the competitive procurement process. B-280405 Proposal for KC-X Tanker ($35B) due at 2 PM, receipt said 2:05 PM. The U.S. Aerospace, Inc. messenger arrived at Wright-Pat at 1:15 PM, a COR took him to the building and upon arrival, gave him a receipt for 2:05 PM Alleged Government misdirection was not the paramount cause. B-403464 Lieberman 13

Polling Question When submitting an offer in response to a solicitation, which part of the solicitation is MOST important? a) The Specifications or Statement of Work b) Instructions to Offerors c) Clauses incorporated by reference Lieberman 14

Response to Polling Question

Timing Be sure to deliver on time as required by the delivery schedule, or if you discover a delay be sure to request an extension in the delivery date, and always offer consideration to the government. The Government may, by written notice of default to the Contractor, terminate this contract in whole or in part if the Contractor fails to deliver the supplies or to perform the services within the time specified in this contract or any extension. FAR 52.249-8 12 days after due date (notified considering default ). ASBCA 14904 8 days after due date (issued show cause) ASBCA 25872 6 days after due date (default). ENGBCA 2973 4 days after due date (issued show cause). DOTCAB 2678 3 days after due date (default). DOTCAB 3095 Offer consideration for change in delivery date CO has no authority to make the change without it. (What consideration is OK?) Consequences of default are severe: Excess cost of reprocurement Possible loss of future contracts Lieberman 16

Verbal / authority Question Authority -Timothy Leary Never rely on the verbal representations of a government official; always rely on the written solicitation. Any prospective bidder desiring an explanation or interpretation of the solicitation, drawings, specifications, etc., must request it in writing. Oral explanations or instructions given before the award of a contract will not be binding. FAR 52.214-6 Oral may be used to solicit micropurchases and simplified acquisitions (up to $150K) Example: an oral change permitting high pressure laminate was not accepted because the written solicitation, requiring another material, controlled. B-298881. Page Limitation-excluding the cover page and past performance forms, the technical proposal is limited to twenty (12) pages in at least 11 pt font, 1 margins. Dept of Homeland Security RFPcan t be changed by a phone call Lieberman 17

Verbal / authority-cont d Do not accept direction from an unauthorized official concerning your obligations under a contract Contracting officers have authority to enter into, administer, or terminate contracts and make related determinations and findings. Contracting officers may bind the Government only to the extent of the authority delegated to them. Contracting officers shall receive from the appointing authority (see [FAR]1.603-1) clear instructions in writing regarding the limits of their authority. Information on the limits of the contracting officers' authority shall be readily available to the public and agency personnel. FAR 1.602-1 Example: Solicitation said Contract Specialist was to be contacted for questions, bidder emailed him to ask if it could fax bid and was told it could. Faxed bids were prohibited by terms of solicitation, and Contract Specialist had no authority to amend it. Bid was rejected. B-403417 COTRs, CORs, Contracting Specialists, ACO s have no authority to award contracts or change quantity, specifications, delivery schedule or price (material aspects of contract). FAR 52.243-1, DFARS 201.602, HHSAR 352.202-1(h), others. Lieberman 18

Example: Authority of the COR (Army contract) You are authorized by this designation to: 1. Verify that the contractor performs the technical requirements of the contract in accordance with the contract terms, conditions and specifications, particularly quality aspects.. 2. Perform inspections and acceptance. 3. Maintain liaison and direct communications with the contractor. Written communications with the contractor and other documents pertaining to the contract shall be signed as Contracting Officer s Representative and a copy shall be furnished to the contracting officer. 4. Monitor contractor performance. 5. You are not empowered to award, agree to or sign any contract (including delivery orders) or contract modification or in any way to obligate the payment of money by the Government. You may not take any action that may affect contract or delivery order schedules, funds or scope. All contractual agreements, commitments or modifications that involve price, quantity, quality, delivery schedules or other terms and conditions of the contract must be made by the contracting officer. You may be personally liable for unauthorized acts. You may not re-delegate your COR authority. Lieberman 19

It Would Be Nice If All Contract Specialists Did This (SIGNATURE BLOCK ON EMAIL) Jennifer Doe Contract Administrator DLA Land and AIR DSCC-AIR jennifer.doe@dla.mil 614-666-4316 / DSN: 750 Fax: 614-666-25512 "I am a contract specialist providing logistic support services to DLA Land and Maritime, with no authority to contractually bind or obligate the Government. My correspondence is for coordination and information gathering purposes only." Lieberman 20

Verbal / authority-cont d Never follow oral promises and direction, instead, follow only what is in the written contract. Contract modification means any written change in the terms of a contract. FAR 2.101 Change order means a written order, signed by the contracting officer, directing the contractor to make a change. FAR 2.101 Supplemental agreement is a contract modification that is signed by the contractor and the contracting officer. FAR 43.103. Oral modifications may not be made where the FAR requires they be in writing. 835 F. 2 nd 865. Lieberman 21

Polling Question Suppose a Contract Specialist ( KS ) asks you to revise the specifications by 3%. Should you: a) Try to convince the KS that no change to the specifications are needed. b) Write to your contracting officer ( CO ), stating what the KS requested, ask the CO what her direction is, and insist that it be in writing. c) Proceed to revise the specs immediately d) Refuse to revise the specs Lieberman 22

Lessons Learned Today Learn from your own good/bad choices don t repeat the bad ones Learn from the good/bad choices of others don t repeat them either! When confronting a new problem think outside the box, in order to avoid repeating past bad choices There are many bad choices in government contracting don t repeat any bad ones that you learned today, or may learn in other presentations. Lieberman 23