Services Contracts Industry Perspective

1
Services Contracts Industry Perspective
47th Annual Boston NCMA Workshop March 12, 2008
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Introduction

• Industry Panel
• Mr Mark Tremblay
• Vice-President and Director, Contract
  Operations
• Mr Tim Ceteras
• Director, Business Development
• Mr Charlie Benway
• Chief Operating Officer
• Objective
• Discuss trends and issues in service contracts
  today, where they are going in the future, and
  industry views.

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US Spends More on Services
Federal Procurement Spending 1997-2006
Billions(source 1997-2006 FPDS files)

• While growth across the board has moderated-
  Services segment is strong
• Professional Services almost 25 of all services
  procured (excluding construction real estate) -
  50.4B in 2006
• Services oriented economy versus manufacturing
  economy

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Service Contract Trends

• Performance-Based Services Acquisition
• Lead Systems Integrators
• Organizational Conflicts of Interest
• Quagmire of laws and regulations
• The B Word - Bundling
• SDVOB Small Business Set-asides
• Small Business Size Status Recertification

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Trends PBSA

• Is PBSA new?
• OFPP Policy Pamphlet 4, A Guide for Writing
  Administering Performance Statements of Work for
  Service Contracts 1980 (rescinded)
• Government Performance Results Act of 1993
• Federal Acquisition Streamlining Act of 1994
  (FASA)
• Clinger-Cohen Act of 1996
• OFPP Policy Letter 91-2, Service Contracting 1991
  (rescinded)
• FAR Subpart 37.6, Performance-Based Contracting
• Reference Guide Seven Steps to
  Performance-Based Services Acquisition
• http//acquisition.gov/comp/seven_steps/index.html
  

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Trends PBSA (concluded)

• Mind-set change
• Government/industry partnership
• Should set objectives and measure performance in
  true outcomes, not rigid requirements
• The lawn should be neat and present a groomed
  appearance vs
• Mow the lawn Tues and Friday at a height NTE
  4.25 inches or as otherwise directed by the PCO
• Stakeholder buy-in
• Meaningful SDS performance objectives/metrics
  (especially for AAS contracts)
• Efficient Effective measurement and reporting
• Infrastructure Management, Processes, People,
  Tools
• Incentives/Penalties/Contract Type

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Trends

• Lead Systems Integrators
• Cost/Schedule/Performance Questions
• Inherent Government Functions and Overlap with
  AAS?
• 2008 NDAA Prohibitions
• Organizational Conflicts of Interest
• FAR 9.5
• Impaired Objectivity and Unfair Competitive
  Advantage
• Flexible enforcement trend
• OCI mitigation
• Exception where more than one contractor
  participates in developing the spec
• Partially driven by industry consolidation?
• Quagmire of laws and regulations
• SCA, CBAs, FLSA
• International - ITAR usually applies

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Trends (concluded)

• The B Word - Bundling
• Good for large businesses
• Maybe not so good for small
• Whats good for the mission/customer?
• What should be the trump card?
• Is it as detrimental as widely advertised?
• Article in Defense AR Journals claims No
• SDVOB Small Business Set-aside Trend
• and rightly so
• e.g. GSA VETS GWAC
• Small Business Size Status Recertification
• Reference FAR 19.301-2 and 52.219-28
• Required for MA or Novation regardless of
  contract duration
• Required for Long-term contracts (gt5 Years)
  prior to year 6
• Does not change contract terms and conditions
  however agency cannot take SB credit if
  contractor can no longer certify as a SB

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More to comeand soon!

• 2008 National Defense Authorization Act
• Prohibition on new LSI Contracts
• No new LSI awards effective 1 Oct 2010 (unless
  LSI performing those functions prior to enactment
  of 2008 NDAA)
• Some exceptions

• Effective 27 May 2008 enhanced competition
  requirements for Task Delivery Orders
• No TO/DO gt100M to a single source
• Exceptions by head of agency exist, but requires
  Congressional notification
• Enhanced competition for TOs/DOs gt5M
• Clear SOW, reasonable response time for props,
  disclosure of evaluation factors, post-award
  debrief
• Permits protests for TOs gt10M (3 year sunset
  provision)

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More to comeand soon!

• 2008 National Defense Authorization Act
• Requires disclosure of JAs Documents for
  Noncompetitive Contracts
• Publicly available on the agency website within
  14 days after contract award
• Additional post-employment requirements for
  senior DoD officials
• Includes PCO, ACO, SSA, SSEB Member, Chief of
  Financial or Technical Evaluation Team for
  contracts in excess of 10M
• Export compliance requirements enhanced

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Continued Change is Inevitable
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Be a Pilot not a Passenger

• We count on our Contracting Professionals to
• Stay current through training and education
• Use this knowledge and add value by helping our
  organizations adjust to changes and position for
  future success