FAR 101:

An Introduction to Doing

Business with the Federal

Government

Presented By:

MARIA L. PANICHELLIOF COHEN SEGLIAS PALLAS GREENHALL & FURMAN, P.C.

FOR THE NATIONAL VETERANS SMALL BUSINESS ENGAGEMENT

The Procurement Process:

A Primer

Essentially, the federal acquisition process begins when a government agency determines its requirements and how to purchase them

If the agency’s contracting officer determines that the appropriate method for procuring the goods or services is a contract, and the contract amount is greater than $25,000, then the agency posts a solicitation on the Federal Business Opportunities website

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What Law Governs the

Procurement Process?

Meet the FAR: The Federal Acquisition Regulation (“FAR”) was established for the codification and publication of uniform policies and procedures for acquisition by all executive agencies

Supplemental Agency Regulations:E.g.: Defense Federal Acquisition Regulation Supplement (DFARS) Army Federal Acquisition Regulation Supplement (AFARS) Engineer Federal Acquisition Regulation Supplement (EFARS)

SBA / VA Small Business Program Regulations

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System for Award Management

The System for Award Management (SAM) has combined federal procurement systems and the Catalog of Federal Domestic Assistance into one new system. SAM includes the functionality from the following systems:

Central Contractor Registry (CCR) Federal Agency Registration (Fedreg) Online Representations and Certifications

Application Excluded Parties List System (EPLS)

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System for Award Management

Federal Contractors must register and provide

information, including:

Characteristics and Capabilities Representations & Certifications Small Business Size & Status Responsibility Compliance Reports Affirmative Action

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SBA Size Standards:

Standards Vary By Industry – Based on North American Industrial Classification Codes (“NAICS Codes”)

Once you know the applicable NAICS code, check the corresponding SBA Size Standard on the SBA’s Website. • Can Be Based on Annual Gross Receipts or Number

of Employees• Represents the largest size that a business may be

to remain classified as “small”• Used by SBA to Determine the Size of a Concern

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Small Business Programs:

What is Small?

Small Business Programs:

VOSB/SDVOSB

Understand the Lingo:

Veteran Owned Small Business (“VOSB”)

Service-Disabled Veteran OwnedSmall Business (“SDVOSB”)

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Small Business Programs:

VOSB/SDVOSB

Two Distinct Programs:

1. VA’s VOSB/SDVOSB Program (VA Contracts)

2. SBA’s SDVOSB Program (All other Agency Contracts)

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Small Business Programs: VOSB/SDVOSB

SBA SDVOSB Program (SDVO SBC)

What is a SDVOSB (SDVO SBC)?

Small Business 51% unconditionally owned

and unconditionally controlled by one or more

Service-Disabled Veteran(s)

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Small Business Programs: VOSB/SDVOSB

VA VOSB/SDVOSB Program (“VetBiz” and

“VIP)

What is a VOSB?

Small Business 51% unconditionally owned and

unconditionally controlled by one or more

Veteran(s)

What is a SDVOSB?

Small business 51% unconditionally owned and

unconditionally controlled by one or more

Service-Disabled Veteran(s)

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Other Small Business

Programs8(a) Program Small Business 51% owned/controlled by socially disadvantaged AND economically

disadvantaged individuals who are of good character who demonstrate potential for success, and are citizens of, and residing in, the United States

HUBZone Program Small Business 51% unconditionally owned and unconditionally controlled by one or more

either (1) Indian Tribal Governments (or companies owned thereby) or (2) US Citizens

Principal office located in a HUBZone At least 35% of its employees reside in a HUBZone / within any Indian

reservation*Different rules for Indian Tribal Governments than other citizens*

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Other Small Business

Programs

WOSB Program Small Business 51% unconditionally owned and unconditionally controlled by one or more Women

EDWOSB Program Small business 51% unconditionally owned and unconditionally controlled by one or more Economically Disadvantaged Women

*NAICS Codes for Industries where Woman are Historically Under-Represented*

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Why Does Affiliation Affect Size?Common Affiliation Issues: Ostensible Subcontractor

• % of Work Requirements• Control on site

General affiliation:• Shared Space, Employees,

Resources, Equipment• Past Employee Relationship• Familial Relationship• Frequent Subcontracting• Financial Reliance/Control

• Guarantor? LOC? Bonding?

Common Pitfalls: Affiliation

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Common Ownership Issues: Indirect Ownership or

Conditional Ownership Specifics are different based on

corporate structure Corporate Governance Docs:

Restrictions on ownership / transfer • Rights of first refusal• Transfer upon incapacity• Transfer upon bankruptcy

Common Pitfalls:

Unconditional Ownership

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Remember:

“Unconditional” Control Two Components

1. Long-Term Decision Making and2. Day-to-Day Management and

Administration of Business Operations

Common Pitfalls:

Unconditional Control

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Common Control Issues: Definitions/Number of

“Managers” or “Members” Positions of Authority, Authority to

Act Given to Others Required Individual Does Not Have

Highest Title Required Individual Not

Experienced Enough Licenses Security Clearances Corporate Governance Docs:

• Quorum or Supermajority Provisions

Common Pitfalls:

Unconditional Control

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Additional Control Concerns:

“Remote” Control Full time Job(s)? Economic Control /

Able To Exert Financial Pressure or Control• Guarantor? LOC?

Bonding?

Common Pitfalls:

Unconditional Control

Understanding the Procurement

at Issue: Key Considerations

Key Considerations:

What Agency (different procedures)?

What type of Contract (Set Aside? MATOC? GSA)?

What type of Procurement (different manner of evaluating bids/offers: Sealed Bidding? Contracting by Negotiation?)

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Understanding the Procurement

at Issue: Who is Procuring?

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You must learn about the table of organization and the chain of command…

Understanding the Procurement

at Issue: What Type of Contract?

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Firm Fixed-Price

Cost Reimbursable

Indefinite Delivery Indefinite Quantity (IDIQ) [MATOC]

GSA Schedule

Set Asides Rule of Two

FAR Part 14 – Sealed Bidding • Invitation for Bids (“IFB”)• Award is Made to the Lowest Responsive and

Responsible Bidder FAR Part 15 – Contracting by Negotiation

• Request for Proposals (“RFP”) • Award is made to the offeror who presents the

“Best Value” - Tradeoff v. LPTA• No public opening

Increasing Importance of Non-Price Factors21

Understanding the Procurement at

Issue: What Type of Procurement?

Sealed Bidding

What is “Responsive?” Only “responsive” bids can be considered for award To be responsive, a bid must comply with all of the

requirements of the invitation to bid; price, quality, quantity, delivery… DON’T GET CREATIVE or QUESTION THESE REQUIREMENTS

Bid invitations often come with other requirements (for example, “bidders shall attend a pre-bid conference”)

Noncompliance can lead to rejection by the contracting authority or a protest by another bidder on grounds of responsiveness

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Sealed Bidding

What is “Responsible?” Contractor, supplier, or vendor, qualified on the basis that it

has adequate financial resources to perform a contract, is able to comply with the associated legal or regulatory requirements, is able to deliver according to the contract schedule, has a history of satisfactory performance, has good reputation regarding integrity, has or can obtain necessary data, equipment, and facilities, and is otherwise eligible and qualified to receive award if its bid is chosen

Small Business – SBA Certificate of Competency FAR 19.601; 13 CFR 125.5

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Typical Evaluation Factors: Past Performance Past Experience w/ Similar Work Proposed Technical Approach/Solutions Management Organization Proposed Schedule Technical Experience/Expertise Key Personnel Qualifications Small Business Subcontracting Plan Price (but remember, it’s not Sealed Bidding)

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Contracting By Negotiation

There is generally no obligation for an agency to conduct discussions where…the RFP specifically instructs offerors of the agency’s intent to award a contract on the basis of initial proposals…The Contraction Officer’s discretion in deciding not to hold discussions is quite broad. Our office [the GAO] will review the exercise of that discretion only to ensure that it was reasonable based on the particular circumstances of the procurement. HDL Research Lab, Inc., B-294959, Dec. 21, 2004 citing FAR 15.306 (a)(3), and Colmek Sys. Eng., B-291931.2, July 9, 2003.

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Contracting By Negotiation:

Award on Initial Proposals

Phases• Competitive Range• Selection

Negotiations are “discussions” with all offerors within the competitive range• Undertaken with the intent of allowing the

offeror to revise its proposal• “Exchanges” is a shifting definition

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Contracting By Negotiation:

Opening up Negotiations

The primary objective of discussions is to maximize the Government’s ability to obtain best value, based on the requirement and the evaluation factors set forth in the solicitation

At a minimum, the contracting officer must indicate to, or discuss with, each offeror still being considered for award, deficiencies, significant weaknesses, and adverse past performance information to which the offeror has not yet had an opportunity to respond

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Contracting By Negotiation:

Purpose of Discussions

Government personnel may not engage in conduct that Favors one offeror over another Reveals an offeror’s technical solution, including unique

technology, innovative and unique uses of commercial items, or any information that would compromise an offeror’s intellectual property to another offeror

Reveals an offeror's price without that offeror’s permission Reveals the names of individuals providing reference information

about an offeror’s past performance Knowingly furnishes source selection information

“Uneven” Discussions Prohibited

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Contracting By Negotiation:

Limitations on Discussions

The contracting officer may request or allow proposal revisions to clarify and document understandings reached during negotiations

At the conclusion of discussions, each offeror still in the competitive range shall be given an opportunity to submit a final proposal revision

The contracting officer is required to establish a common cut-off date only for receipt of final proposal revisions

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Contracting By Negotiation:

Final Proposal Revision

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Consideration for Award

IFBs – Lowest Price, Responsive, Responsible & (maybe) Realistic

RFPs – Evaluation of Price and Non Price Factors• Proposal evaluation is an assessment of the proposal and the offeror’s

ability to perform the prospective contract successfully• An agency shall evaluate competitive proposals and then assess their

relative qualities solely on the factors and subfactors specified in the solicitation

• Evaluations may be conducted using any rating method or combination of methods, including color or adjectival ratings, numerical weights, and ordinal rankings

• The relative strengths, deficiencies, significant weaknesses, and risks supporting proposal evaluation shall be documented in the contract file

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Consideration for Award:

Source Selection Decision The source selection authority’s (SSA) decision shall be based on a

comparative assessment of proposals against all source selection criteria in the solicitation

While the SSA may use reports and analyses prepared by others, the source selection decision shall represent the SSA’sindependent judgment

The source selection decision shall be documented, and the documentation shall include the rationale for any business judgments and tradeoffs made or relied on by the SSA, including benefits associated with additional costs

Although the rationale for the selection decision must be documented, that documentation need not quantify the tradeoffs that led to the decision

Unsuccessful Offeror Notice

Pre-Award Notice (FAR 15.503(a)(1)):

Preaward notices of exclusion from competitive range - The contracting officer shall notify offerors promptly in writing when their proposals are excluded from the competitive range or otherwise eliminated from the competition. The notice shall state the basis for the determination and that a proposal revision will not be considered.

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Unsuccessful Offeror Notice

Pre-Award Notice (FAR 15.503(a)(2)):

In Small Business, HUBZone, VOSB/SDVOSB or WOSB/EDWOSB procurement, Contracting Officer must notify each offeror in writing PRIOR to award

Notice must state:a) Name and Address of the Apparently Successful Offerorb) That the Government Will Not Consider Subsequent

Revisions of the Offeror’s Proposal c) That No Response is Required Unless a Basis Exists to

Challenge the Size Status or Small Business Status of the Apparently Successful Offeror

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Unsuccessful Offeror Notice

Post-Award Notice (FAR 15.503(b)):

Within 3 days after award, each unsuccessful offeror shall be notified of:

• The number of proposals received • Name and address of each awardee • The award price, including unit prices quantities • In general terms, the reasons why the offeror’s

proposal was not accepted

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Next Steps?

Debriefing and Protest or Award and Performance

Possibly REAs, Claims, Termination Issues

Debriefings and Protest Session - 11/19 at 10:05am

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Questions?

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Maria L. Panichelli, Esq.mpanichelli@cohenseglias.com@MariaPanichelli (twitter)

www.linkedin.com/in/mariapanichelli/

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Contact Information