FAR and Beyond Blog

Top Coalition Priorities for 2012

December 16th, 2011

Here are our current “Top Five” issues that have a direct impact on our members that we will continue to address in 2012.

  1. Other Direct Costs (ODC). Developing an efficient, effective and accountable contract mechanism for including ODCs and materials on GSA MAS service contracts is vital to providing best value, comprehensive solutions to customer agency service requirements via the MAS program. Too often, the prohibition on ODCs leads customer agencies to other less competitive contract vehicles or to the creation of duplicative contracts. The FAR provides the flexibility to include materials and ODCs on commercial item indefinite quantity, indefinite delivery contracts. The MAS program should follow the FAR. This year the Coalition and its ODC working group developed and provided GSA with a White Paper addressing the issue. We will continue to engage GSA.
  2. MAS Pricing Policies and Procedures. The MAS pricing policies and procedures have not fundamentally changed in over 30 years. Yet, the commercial and federal market place are far different today than in 1982. Services account for approximately two-thirds of the dollar value under the MAS program while the pricing for services is governed by regulations essentially written for commercial products. Moreover, given the statutory mandate for competition at the order level for orders over $150,000, the price reduction clause (PRC) is no longer relevant. Yet, government and industry are incurring significant compliance costs associated with the PRC. Reform of the MAS pricing policies would increase competition, streamline the process and provide best value to the taxpayer. In 2012, the Coalition will be establishing a Pricing Working group to address the current policy. It is our understanding that next year GSA also will be reopening its GSAR 538 rewrite of the MAS pricing policies. The Coalition looks forward to the opportunity to work with all stakeholders on the MAS pricing policy.
  3. Implementation of Section 1331 of the Small Business Jobs Act of 2010. Section 1331 directs the Administrator of OFPP to develop guidance providing that agencies, at their discretion, may set-aside or reserve contracts and/or set-aside orders for small businesses under multiple award contracts. On November 2, 2011, an interim FAR rule was issued implementing Section 1331. The language of the interim rule essentially mirrors the statute providing that agencies may, at their discretion, set-aside contracts and/or orders. The interim rule covers multiple award contracts under FAR 16.5 as well as MAS contracts under FAR 8.4. The key to the statute and regulation is that the decision whether to set-aside a contract or order is discretionary not mandatory. The MAS program already is the most successful governmentwide small business contracting program. Over the last decade under the MAS program, approximately 30-35 percent of the dollar value of orders has gone to small businesses, exceeding the governmentwide goal of 23 percent. The small business success of the MAS program is based on flexible, discretionary ordering procedures that provide opportunity for agencies and small business to transact. It is not based on mandatory set-aside requirements. The Coalition will continue to work for a flexible and efficient MAS program that benefits government, contractors (small, medium and large) and the taxpayer.
  4. Contract Duplication. Contract duplication increases government and industry costs. The proliferation of contract vehicles over the last decade has reduced contract effectiveness and efficiency. We cannot afford unnecessary contract duplication. GSA plays and will continue to play a leading role in reducing contract duplication through the MAS program and IT GWACs. Over the last year, the Coalition has supported the Administration’s efforts to develop business case analysis policy that requires review and consideration of pre-existing contract vehicles before creating a new standalone contract. In the next year, the Coalition will continue to identify opportunities to reduce contract duplication.
  5. Improving MAS Blanket Purchase Agreements (BPAs). The use of generic BPAs without specific requirements and/or volume commitments unnecessarily increases government and contractor bid and proposal costs. This is especially true when governmentwide multiple award BPAs contemplate further task order competitions under the BPAs. Throughout the last year, the Coalition has raised awareness of practices that unnecessarily increase costs and reduce efficiency. In 2012, the Coalition will be issuing a list of BPA best practices that identifies the keys to successful BPA competitions and outcomes for government, contractors and the taxpayer.

Of course there are other issues of importance the Coalition will also address in 2012, including ever growing data reporting requirements imposed on contractors, Trade Agreements Act implementation and compliance, strategic sourcing, ecolabels, and the development of policy addressing counterfeit items and the supply chain. In addition, over the next 30 days each of our committees will be developing business agendas for 2012 identifying committee level objectives for the members.
As always, the Coalition will work for common sense in government procurement that provides sound business opportunities for contractors and delivers best value for government and the taxpayer.

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