FAR Case 2008-012, Clarification of Submission of Cost or Pricing Data on Non-Commercial Modifications of Commercial items (Comment #1)

8 April 2009 Janet C. Sumner AMSCC-TAC-HML TACOM Contracting Center 6501 E. Eleven Mile Road Warren, MI 48397-5000 Subject: Comments on FAR Case 2008-012; Item II; Docket 2008-0001, Sequence 10, RIN 9000-AL12 The interim rule in its current form is unclear to us with regards to the term “… the total price of the contract at the time of contract award”, which is used in the amended rule. Since the calculation could be based on a percentage of the “total price of the contract” (as opposed to the threshold for obtaining cost and pricing data), knowing what the “total price of the contract (at the time of contract award)” consists of becomes a relevant issue, as through subsequent delivery orders and/or contract modifications, the contract’s total price often changes. Take for example, a long term Indefinite Delivery Indefinite Quantity (IDIQ) contract or a requirements contract. The basic contract instrument, technically, never has any value (funding) assigned to it during its lifetime. All funds (value) are tied to the subsequent individual delivery orders. So we do not understand what the “total price of the (long term IDIQ) contract” is, at time of award. Here at the TACOM Contracting Center, we issue/award the first delivery order at the same time as the initial/basic contract award. So, would the “total price of the contract (at the time of contract award)” be the value (total price) of the first delivery order, and would that “total price” hold for the life of the contract, regardless of the value of that (the first order), or subsequent delivery orders issued against the contract? Or would the “total price of the contract” be the cumulative value of the delivery orders as they are issued/awarded against the contract, during its lifetime? Accordingly, we would like the term “total price of the contract at time of contract award” clarified, to eliminate any confusion as to whether the writer is referring to: a) the total price/value of the contract at the time of initial/original award (NOTE: this would not take into account subsequent delivery orders and/or modifications that could significantly affect the “total price of the contract”). b) the total current cumulative total price/value of the contract at the time of contract award at the present time, including all subsequent/additional contract action(s), and the value of the instant/immediate action. c) the total current cumulative total price/value of the contract at the time of award at the present time, including all subsequent/additional contract action(s), but excluding the value of the instant/immediate action (as it has not been awarded yet and is therefore, not part of the contract yet). d) the total price/value of the instant/immediate contract action (only) that is being awarded. e) some other meaning that we have not presented here. Depending on the intent of the authors (see above), request the wording in the interim/amended rule be changed to one of the following (in both paragraphs (B) and (C) of 15.403-1(c)(3)(ii)): a) … the greater of the threshold for obtaining cost and pricing data in 15.403-4 or 5 percent of the total price of the contract at the time of initial /original contract award. b) ... the greater of the threshold for obtaining cost and pricing data in 15.403-4 or 5 percent of the current/cumulative contract value including all subsequent/additional actions since initial award and the value of the instant/immediate action. c) ... the greater of the threshold for obtaining cost and pricing data in 15.403-4 or 5 percent of the current/cumulative contract value including all subsequent/additional actions since initial award but excluding the value of the instant/immediate action. d) … the greater of the threshold for obtaining cost and pricing data in 15.403-4 or 5 percent of the total price of the instant/immediate contract action. e) … some other meaning that we have not presented here.