The National Aeronautics and Space Administration (NASA) has been a topic of interest since President Obama took office more than a year ago and almost immediately ordered an independent review of NASA’s manned space program. That review, carried out by the Augustine Commission, had nothing but bad news for the Administration, reporting “The U.S. human spaceflight program appears to be on an unsustainable trajectory.”
More recently—and perhaps in response to the Augustine Commission’s pessimistic assessment—the Obama
Administration announced a budgetary shift for NASA, giving the agency
more funds for R&D, while taking away funds from the planned return
to the moon—“killing the Constellation program” in the words of this article by the Washington Post. The article explains—
The
old NASA strategy set a destination first, and developed technology --
rockets and a crew capsule -- to get there. The new strategy calls for
pouring billions into space technologies without defining the
destination. The
idea is to create technological flexibility so that astronauts could
potentially visit a variety of locations in the inner solar system,
including the moon, near-Earth asteroids and possibly Mars or the moons
of Mars. The ‘Flexible Path’ strategy was favored by the advisory panel appointed last year by President Obama to review NASA's options.
This article at SpaceNews.com is rather moreoptimistic; it
quotes a NASA executive as saying, “This is a great budget. It’s a
major increase to the science budget. It’s an especially major
increase to the Earth science budget.”
While NASA wrestled with its future vision and mapping a path to manned space missions, back on Earth the Government Accountability Office (GAO) was busy criticizing its unmanned satellite missions, telling Congress that “NASA
frequently exceeded its own acquisition cost and schedule estimates,
even when those estimates were relatively new. In fact, 9 out of 10
projects that have been in implementation for several years significantly exceeded their cost or schedule baseline estimates—all in the last 3 years.”
In
a report released on February 1, 2010, GAO assessed 19 “large-scale”
unmanned NASA projects, of which 15 had entered the “implementation”
phase. Of those 15, GAO concluded that nine of them “experienced
significant cost and/or schedule growth from their project baselines.”
(Four projects were considered to be in the “formulation” phase, and
NASA did not provide GAO with formal cost and schedule information on
them.) GAO reported—
Based
on our analysis, development costs for projects in our review increased
by an average of over 13 percent from their baseline cost
estimates—including one project that increased by over 68 percent—and
an average delay of almost 11 months to their launch dates. These
averages were significantly higher when the four projects that just
entered implementation are excluded. Specifically, there are 10
projects of analytical interest because (1) they are in the
implementation phase, and (2) their baselines are old enough to begin
to track variances. Most of these 10 projects have experienced
significant cost and/or schedule growth, often both. These projects had
an average development cost growth of 18.7 percent—or almost $121.1
million—and schedule growth of over 15 months, and a total increase in
development cost of over $1.2 billion. Over half of this total increase
in development cost—or $706.6 million—occurred in the last year. These
cost growth and schedule delays have all occurred within the last 3
years, and a number of these projects had experienced considerable cost
growth before baselines were established in response to the 2005
statutory reporting requirement.
See GAO’s entire report here.
The GAO report also noted that roughly $1 billion in ARRA funds was
given to NASA, much of which was used to offset some of the cost growth
it reported.
In its report, GAO reviewed six factors that it believed contributed to cost and schedule growth. Those six factors were:
Technology maturity (including maturity of critical technology as well as maturity of heritage technology)
Design stability
Contractor performance
Development partner performance
Funding issues
Launch manifest issues
The
report discussed each of the above factors as they apply to NASA’s
projects. More interestingly, the report devotes two pages of detail
to each individual project. Following are some “highlights” from the
detailed project reports.
Aquarius
Project – Only 16 percent of engineering drawings released at Critical
Design Review (CDR) milestone. No engineering test models because of
funding constraints. Ten month schedule slip and $10.7 million cost
growth.
Ares
I Crew Launch Vehicle (CLV) – “The Constellation program’s poorly
phased funding plan has diminished the Ares I project’s ability to deal
with technical challenges.”
Glory Project – Only 69 percent of drawing released at CDR. 14 percent cost increase and 10 month schedule slip since rebaselining in FY 2009. Currently, recent launch failure of Taurus XL rocket threatening current scheduled launch date.
James
Webb Space Telescope (JWST) – “The JWST project was re-planned in
fiscal year 2006 after a $1 billion cost increase and a 2-year schedule
delay on the project. In fiscal year 2009, the project established its
baseline with a life cycle cost of $4.96 billion and a June 2014 launch
date. This represents about a $500 million increase over NASA’s 2006 replan figures and has resulted in another 1-year delay of the launch readiness date.”
Kepler – “Since being baselined in fiscal year 2007, Kepler’s
development costs have increased by about 25 percent and its schedule
has increased by 9 months. Project officials attribute the cost and
schedule growth to many things, including a $35 million budget
reduction in fiscal year 2005. This funding instability contributed to
an overall 20-month delay in the project’s schedule and about $169
million in cost growth.”
Mars
Science Laboratory (MSL) – “MSL’s cost has grown over $660 million
because of technological and engineering problems. This includes more
than a 68 percent increase in development costs. The project is using a
25-month schedule delay to work on overcoming technical challenges with
the actuators and avionics that were the primary drivers for the slip.”
Solar
Dynamics Observatory (SDO – “SDO’s design was not stable at the
critical design review (CDR). Following this review, the project
experienced nearly a 1,200 percent overall increase in the number of
releasable drawings expected. Project officials said only drawings for
in-house structures, such as propulsion systems, electronics,
instrument ports, the high-gain antenna system,
and the spacecraft, were considered at CDR. Drawings for the
instruments were not included and flight drawings were only in draft
form at CDR. The project estimated it released less than 63 percent of
engineering drawings at each of their instrument-level CDRs.”
From
one point of view, the GAO report is a litany of project management
failures. But from another point of view, the report tells various
stories of individual project teams doing the best they could in
difficult circumstances, trying to create state-of-the-art scientific
instruments and manage complex systems, while being held to unrealistic
budgets and almost impossible launch schedules.
Very
few people care about the difficulties and the challenges of the NASA
missions; they prefer to criticize the easy targets of cost growth and
schedule slip. Even though we here at Apogee Consulting, Inc. firmly
maintain that projects can be managed to successful cost, schedule,
quality and performance objectives, we also understand the difficulties
faced by these project teams. We are reminded of this saying by Theodore Roosevelt, spoken before the Sorbonne in 1910—
It is not the critic who counts: not the man who points out howthe strong man stumbles or where the doer of deeds could have done better.
The credit belongs to the man who is actually in the arena, whose face
is marred by dust and sweat and blood, who strives valiantly, who errs
and comes up short again and again, because there is no effort without
error or shortcoming, but who knows the great enthusiasms, the great
devotions, who spends himself for a worthy cause; who, at the best,
knows, in the end, the triumph of high achievement, and who, at the
worst, if he fails, at least he fails while daring greatly, so that his
place shall never be with those cold and timid souls who knew neither
victory nor defeat.
Rough Ride for the F-35
administrator
We’ve been holding off discussion of the F-35 “Lightning II” Joint Strike Fighter (JSF) until things settled down a bit. Well, things haven’t really settled down, but there’s enough news that it seems a good time to take stock of the program.
Readers will recall our previous article,
in which we inquired how much the JSF will really cost its
customers—both in the US and abroad—and noted that “time will tell who
has the best at-completion estimate, the Pentagon JET evaluators or the
program team.” Since then, the Obama Administration has moved to eliminate the alternate engine competition, purchases of production aircraft have been delayed, the Pentagon has fired its Program Manager, and SecDef Gates announced that Lockheed Martin will lose $614 million in budgeted award fees based on the program’s problematic performance. Oh, and a leaked Navy briefing reported that—
… over
the lifetime of the fleet - the carrier-based and STOVL JSF versions
will cost the Navy 40 per cent more, in total operating costs, than the
F/A-18C/Ds and AV-8Bs that they replace. (The older aircraft costs are
taken from FY2008 and include a lot of aging-aircraft issues.) This is
despite a smaller fleet and fewer flight hours: the new aircraft are expected to cost more than 60 per cent more to fly per hour than their predecessors.
The
Navy report suggests that the total cost of the Pentagon's JSF program
will be $705 billion in FY2002 dollars, just over twice the figure
predicted at the program's inception.
But that’s not all. In response to our previous question, DefenseNews.com reported that the
Pentagon is accepting the Joint Estimating Team (JET) budget
projection, and consequently is adding $314 billion to the program’s
official budget (over a five-year period). But not content to stop
there, the article reported that USD (AT&L) Dr. Ash Carter “is set
to order [yet another] bottom-up review of the program and its costs.”
In the words of SecDef
Gates, “Progress and performance of the F-35 over the past two years
has not been what it should, as a number of key goals and benchmarks
were not met.”
It
should not be forgotten that the F-35 is truly an international fighter
development and production program, with eight other nations
participating in its funding. Those other nations are getting nervous
that delays and cut-backs in the number of aircraft being purchased
will raise the per-craft price—and as the per-craft price has risen,
those countries have begun to consider cutting-back their production
orders even more.
This article discusses the increase in price to the United Kingdom of Great Britain, and states that the aircraft’s price “has risen from £37m each four years ago to £62m now.”
As a result, “a consensus has emerged … that they cannot afford the 140
American Joint Strike Fighters … they had been seeking. … One
compromise would be for the Ministry of Defence (MoD) to halve its order from 140 planes to 70.”
Officially,
the program calls for delivery of 5,500 aircraft—2,400 to the US and
3,100 to the international partners. Lockheed Martin asserts that it
can manage the program and catch-up schedule, while controlling cost
growth. If it cannot, it may find itself the builder of a white
elephant fighter whose lack of economies of scale make the plane
unaffordable for its international partners. The stakes are high, not
only for Lockheed Martin (whose stock has been downgraded based at
least in part on its F-35 problems), but also for the US Air Force.
Claiming the Government Acted in “Bad Faith”
administrator
Recently somebody posted this cry for help on the LinkedIn Question & Answer Board—
We have a COTR that is causing problems with our contract and need a recommendation for an attorney … Can anyone help us?We have a service contract … and the COTR has lied, is now causing our Supervisor to quit because he feels he is being harassed by him… and more. Does this constitute a delay and/or Government Interference? Any help is appreciated.
Let’s
look at this from two perspectives. First, let’s talk about delay and
disruption. This is really two issues. In a delay claim, the
contractor is claiming compensation for not being able to work. In
some situations, that claim can include the costs of “unabsorbed
overhead”—i.e., indirect costs that would have been absorbed on the
instant contract, had the labor hours or dollars been incurred as
scheduled, but which now will be absorbed by other contracts, causing
them to incur more costs than they had planned. In a disruption claim,
the contractor is asking for additional compensation because the work
is more complex, and more expensive, than the parties originally
agreed.
The
contractor must prove for either claim the elements of liability,
causation, and resultant injury. When the contractor is asserting a
delay claim, the contractor has the burden of showing the extent of the
delay, that the delay was proximately caused by government action, and
that the delay caused damage to the contractor. While the law requires ‘reasonable certainty’ to support a damages award, damages do not need to proven with mathematical exactness. Rather, ‘[i]t
is sufficient if a claimant furnishes the court with a reasonable basis
for computation, even though the result is only approximate.’ The preferred method for proving costs is through the submission of actual cost data. However, where actual cost data is not available, estimates of the costs may be used. Estimates of costs ‘should be prepared by competent individuals with adequate knowledge of the facts and circumstances,’ and should be “supported with detailed substantiating data.” [All legal citations omitted.]
What
the LinkedIn interlocutor is also hinting about is whether, by engaging
in lying and harassment and unreasonable delays, the Government has
breached its implied duty of “good faith and fair dealing”. As an aspect of these duties, “[e]very contract . . . imposes animplied obligation ‘that neither party will do anything that will hinder or delay the other party inperformance of the contract.’”Such covenants require each party “not to interfere with the other party's performance andnot to act so as to destroy the reasonable expectations of the other party regarding the fruits of thecontract.” This “dutynot to hinder is breached when the Government commits ‘actions that unreasonably cause delayor hindrance to contract performance.’” [Legal citations omitted.]
The case law is well-settled that the Government enjoys a presumption that it acts in good faith. To
overcome that presumption, “the proof must be almost irrefragable” –
which has also been described as “clear and convincing evidence” of
“some specific intent to injure” the contractor.“Courts
have found bad faith when confronted by a course of government conduct
that was ‘designedly oppressive,’ or that ‘initiated a conspiracy’ to
‘get rid’ of a contractor. As these cases illustrate, the ‘irrefragable
proof’ standard, though daunting, is not intended to be impenetrable, that is, it does not ‘insulate government action from any review by courts.’” [Emphasis in original;legal citations omitted.]
Recently
the U.S. Court of Appeals, Federal Circuit, affirmed a decision by the
U.S. Court of Federal Claims in which the contractor successfully
proved bad faith on the part of its Government customer, the U.S. Army
Corp. of Engineers. The tale is a sad one, where certain government
individuals exercised their authority (and more!) to the detriment of the contractor, North Star Housing. As the Court
found, “the record provides a virtual rancid cornucopia of electronic
messages and other communications evidencing a specific intent by key
government officials to injure North Star.” See the entire CoFC decision here.
As the Court observed, “Among the most troubling aspects of the case …is
clear proof that Mr. Peterson, Ms. Kiser and others eventually co-opted
the contracting officer who was responsible for ruling on North Star’s
claims.” Although
the FAR requires the contracting officers to ensure that contractors
“receive impartial, fair, and equitable treatment,” the Court found the
contracting officer did not do so in this case. The Court declared—
Abdication
of those responsibilities in the face of pressure from government
officials who plainly are driven by animus against a given contractor
constitutes perhaps the most pernicious form of bad faith on the part
of the government, as it threatens the integrity of a dispute
resolution process that is central to the government contracting system
itself.
Despite
the Court being “thoroughly convinced” of the Government’s breach of
its duty of good faith and fair dealing, the plaintiff (North Star) was
not awarded as much money as it had hoped for. First, some of its
claims were dismissed for lack of jurisdiction, because they had not
been first presented to the contracting officer with a “sum certain” as
the FAR and Contract Disputes Act (CDA) require. Second, North Star’s analysis of its damages was found to be lacking by the Court. As the Court stated, “such [Government] liability, no matter how egregious, does not obviate the necessity for plaintiff to prove its damages.”
To wrap up, many
contractors are afraid to submit claims because they are worried about
angering their customer(s) and losing future work. (We note that
contractor evaluations and past performance ratings cannot be affected
by assertion of contractual rights.) Contractors
seeking to assert claims against their Government customers need to
understand what their cause of action is. Are they asserting
Government-caused delay or disruption? And are the Government’s
actions tied
to any provable breaches of its duty to act in good faith? Finally,
what damages can be proven, and have all the steps of the FAR and CDA
strictly been followed when asserting the claim?
GAO Points Out Potpourri of Problems with Pentagon Procurement Process
administrator
On January 20, 2010, GAO offered testimony before the House Committee on Appropriations, Subcommittee on Defense (John Murtha, D-PA, Chair). The testimony, which can be found here, had the rather misleading title of “Managing Risk to Achieve Better Outcomes.” The
testimony was not really about risk management; instead, it was more of
a recap of various DOD acquisition issues that the GAO has been criticizing for years—most of which are rather obvious.
Highlights of the GAO testimony—
The first opportunity to reduce acquisition risk is in the early planning phases.
Risk can be reduced through selecting the appropriate contract type.
Risks that are not effectively managed in the pre-execution phase of a contract may become costly problems during execution.
Acquisition risk
management is dependent on a “capable” acquisition workforce; yet “DOD
lacks key information about the current number and skill sets of its
acquisition workforce and what it needs.”
Because DOD relies so heavily on contractors to support its acquisition process, and lacks insight into the
roles its contractors are fulfilling, the Department cannot make
effective decisions regarding its acquisition workforce staffing—thus
“increasing the risk of transferring government responsibilities to
contractors.”
The testimony reiterated familiar themes, such as—
Risk
is inherent in any major acquisition, whether a weapon system or
complex service acquisition. But it is only through the thoughtful
management of risks throughout all phases of the acquisition process
that successful outcomes can be achieved. Clearly, however, DOD has not
adequately managed such risks. For example, its major weapon
systems continue to take longer to develop, cost more, and deliver
fewer quantities and capabilities than originally planned. … Despite
decades of reform efforts, these outcomes and their underlying causes
have proven resistant to change and, in fact, both DOD weapon system
acquisition and DOD contract management have been on our high-risk list
for nearly 20 years.
Much more interesting than the reiteration of simplistic observationsis the summary of GAO bid protest statistics. Although released separately, the testimony included an
overview of the recent history of GAO’s “quasi-judicial” function as
arbiter of bid protests. (Readers will note that the U.S. Court of
Federal Claims also performs in a similar capacity.) We previously
have wondered out loud whether the Department of Defense has “lost its
ability to evaluate proposals fairly and in accordance with the written
evaluation criteria.” The GAO testified that—
There
has been a substantial increase in spending on acquisition programs and
services, while the number of civilian and military personnel in DOD’s
acquisition workforce has remained relatively constant. Program offices
have reported that workforce shortfalls have resulted in degradation in
oversight, delays in certain management and contracting activities, and
increased workloads for existing staff. To supplement its in-house
acquisition workforce, DOD relies heavily on contractor personnel. For example, we have found that in some program offices contractor personnel outnumber DOD personnel.
Have DOD’s acquisition workforce problems contributed to degradation in the ability to conduct fair and equitable evaluations of bidders for major defense acquisition programs?
One way to assess the situation would be to look at GAO’s bid protest
decisions, to see whether the sustention rate is elevated when compared
to historical norms.
According
to the GAO 2009 bid protests are up 20% over the prior year—1,764 vs.
1,458. Comparing 2009 to 2005, bid protests are up nearly 40%--1,764
vs. 1,262. (Readers should take GAO’s numbers with a grain of salt,
however. GAO counts every “docket number” as an individual protest; a single protest can have multiple docket numbers.
Moreover, the quantity of protests filed really tells us nothing.
Government spending also increased during that period, so one might
logically expect an increase in bid protest activity.
In addition, GAO recently received expanded bid protest jurisdiction
over task orders, which accounting for 49 of its 2009 bid protests)
Sustention of bid protests is measured against “merit decision” (not the number of cases filed) and the numbers show that the sustention rate actually dropped during that period—from 71/306 (23%) to 57/315 (18%).
So rather than a degradation, the evidence points to an improvement in
the Government’s ability to carry out its acquisition function!
Looking just at the Defense Department, the number of protests filed was up nearly 50 percent—from 706 to 1,050. But as before, the percentage of sustained protests actually decreased from 18% to 12%.
GAO
also reports an “effectiveness rate”—which is defined as a situation
when a protester receives some form of relief from the Government
agency conducting the procurement, even if it did not have its protest
sustained. Looking at the reported effectiveness rates, there has
actually been some increase, from 27 percent (2005) to 45 percent
(2009). It’s difficult to determine what this means without further details.
So
the statistics may be meaningful, or not. We’ll leave any
conclusion(s) to our readers’ judgment. But we maintain that anecdotal
evidence is mounting that DOD is having trouble evaluating bidders for
major defense acquisition programs without opening the door to a
successful bid protest. As GAO notes in its report, such recent
programs as CSAR/X, Aerial Refueling Tanker, FMTV, and TRICARE were
interrupted by successful protests by the losing bidders. And as we
have noted with respect to two of those programs listed by GAO, the
errors cited by GAO were of the “blocking and tackling” variety, and
not of the “difficult and complex” variety. We hope DOD gets its act
together, soon.
SAIC Tests FCS Equipment: A Clear Conflict of Interest, Says DOD IG
administrator
On January 27, 2009, the Department of Defense Inspector General (DOD IG) released a redacted version of its report on
“contracted advisory and assistance services for the U.S. Army Future
Combat Systems.” The report concluded that the DOD’s Director of
Operational Test and Evaluation (DOT&E) had engaged SAIC as its
“primary commercial contractor” supporting its testing needs, even
though SAIC (along with Boeing) serves as the Future Combat Systems
(FCS) Lead System Integrator for system design and development, and
even though SAIC’s contract with DOT&E “explicitly stated ‘…
providers are excluded from this contract who have significant
involvement in the development of DoD systems that are under, or will be under DOT&E oversight’.” Despite
SAIC’s argument that its role on the FCS contract was one of system
integrator, not system developer, the DOD IG found that the FCS
contract had received billions of dollars out of the Army’s Research,
Development, Test and Evaluation (RDT&E) appropriation—thus, SAIC
was de facto a system developer. The DOD IG Report,
blasted the entities involved for this situation, stating that
“DOT&E and the Army did not exercise the good judgment and sound
discretion needed to prevent the existence of conflicting roles that
might bias a contractor’s judgment or provide it an unfair competitive
advantage.” Ouch.
According
to the DOD IG, after the situation was brought to the parties’
attention, SAIC’s advisory/assistance support contract to DOT&E was
quickly modified to “delete the FCS-related tasks” after officially
“concluding that SAIC had statutory OCIs regarding those tasks.”
But what is an Organizational Conflict of Interest (OCI)? We’ve touched on this topic before, notably in connection with Northrop Grumman’s sale of its TASC unit. Essentially, the FAR states that an OCI exists when one of three situations exists—
1.An individual is actually (or potentially) unable to provide the government with “impartial assistance or advice”
2.A person’s objectivity in performing contract work is or might be impaired
3.A person or entity has an unfair competitive advantage
An
OCI can be created with respect to an existing contract or with respect
to future work. The FAR (at 9.5) discusses “Organizational and
Consultant Conflicts of Interest,” and (according to the DOD IG audit
report) “places restrictions on contractors being placed in a position
to make decisions that favor their own products or capabilities.” The
DOD IG also noted that 10 U.S.C. § 2399 “places further restrictions on
system developers supporting operational test and evaluation.”
The
DOD IG report also noted that Army Contracting Officers had a
responsibility to identify and, if possible, mitigate actual or
potential OCIs.
(See FAR 9.504.) Moreover, the FAR directs “The contracting officer
shall award the contract to the apparent successful offeror unless a
conflict of interest is determined to exist that cannot be avoided or
mitigated.” Despite the FAR requirements regarding OCIs, the DOD IG concluded—
We
were unable to determine if the contracting officer performed any
evaluation beyond accepting statements made in SAIC’s proposal to
determine if potential issues existed that would hinder SAIC’s ability
to provide unbiased advisory and assistance services related to the
overall contract or the specific scope of work SAIC performed under [the Delivery Order]. There was no documentation in the contracting file to show how the issue was addressed.
…
We found no evidence that anyone evaluated whether SAIC was significantly involved in the development of a DoD
system that DOT&E was or would be overseeing prior to contract
award. According to the contracting officer, DOT&E did not see a
conflict with awarding the contract to SAIC because it had previously
been fulfilling the requirements under a bridge contract that was
entered into after the previous prime contractor was dropped after
being acquired by Northrop Grumman, another FCS systems developer. Only
after an inquiry was made was the issue of how the Government reached
its conclusion that SAIC’s participation in the development of the FCS
did not violate the OCI clause contained in the solicitation examined.
In addition, the DOD IG found similar concerns with Northrop Grumman, CSC, General Dynamics, and Lockheed Martin. It reported—
We
were unable to determine how the contracting officer concluded that the
business isolation procedures that Northrop Grumman described in the
proposal it submitted for the overall contract was consistent with the
OCI provisions of 10 U.S.C. 2399 or the OCI clause contained in their
overall contract. However, based on documentation contained in the
contract files, it appears the contracting officer concluded that
Northrop Grumman possessed no OCIs related to the requirements of
either delivery order.
…
In
their proposal, the Test and Experimentation Services Company [a JV
that included CSC] informed the contracting officer that it possessed
OCIs with respect to the work to be performed under the work
authorization orders. However, the company proposed that CSC’s partner
perform all the work under the contract. Thus, the Director of
Contracts stated that based on that fact, the command concluded that
awarding the scope of work to the Test and Experimentation Services
Company did not violate Title 10’s OCI restrictions because CSC would
not share in any of the profit derived from the contract.
…
The
OCI provisions prohibited FC Business Systems from satisfying
requirements resulting from its work under the contract, and the task
order issued to support the OTC Air Defense Artillery Test
Directorate’s mission requirements included additional restrictions to
prevent FC Business Systems from operationally testing equipment it
helped manufacture. However, the provisions did not require FC Business
Systems to inform the Government of its acquisition by General
Dynamics. As a result, the OTC and General Services Administration did
not detect that General Dynamics, one of Boeing’s major FCS development
subcontractors (after acquiring the FC Business Systems) was helping
the command plan, coordinate, collect, and reduce data used to evaluate
the effectiveness and suitability of the FCS, a clear violation of the
OCI provisions in 10 U.S.C. 2399.
The DOD IG made several
recommendations designed to prevent similar situations from arising in
the future. Among them, it recommended that the Director of Defense
Procurement and Acquisition Policy, Mr. Shay Assad, develop a new DFARS
clause that would preclude “contractors that are involved in the
development, production, or testing of a system … from providing
technical advice to the program office for that system or from
participating activities impacting the operational test and evaluation
of that system unless appropriate waivers are obtained.” Importantly,
the new clause would “make
it incumbent on the proposing contractor to identify in their proposal
any work that that they are or have performed either under prime
contract or subcontract related to the development or supply of a DoD system.”
The report noted that Mr. Assad agreed with the recommendation. “The Director also stated that hewould issue a memorandum emphasizing the importance of complying with FAROCI provisions after the FAR Acquisition Law Team issues its final rule for a related FAR case to ensure that he does not issue conflicting guidance.”
We recommend that contractors supporting government test and evaluation functions take note.
Effective January 1, 2019, Nick Sanders has been named as Editor of two reference books published by LexisNexis. The first book is Matthew Bender’s Accounting for Government Contracts: The Federal Acquisition Regulation. The second book is Matthew Bender’s Accounting for Government Contracts: The Cost Accounting Standards. Nick replaces Darrell Oyer, who has edited those books for many years.
