Early Award with Delayed Period of Performance

To answer your question:  Will FAR 1.102(d) work for you?

As an aside, it looks like you tried to do a competitive procurement, but you failed to achieve competition.  I hope you inquire for the reason for the failure.

As another aside, as a fellow professional, I apologize to you for your “Management.”

Isn't this what frequently happens in August and September when contracts are written to begin in October?

I think the disconnect is that management wants an FMR citation regarding lead in and generally accepted practices.  I agree that nothing seems to prohibit it, however I was hoping some rule of financial management might ease their heartburn about.  If no such reference exists, I’m comfortable making another argument for it.

We (Corps of Engineers) often awarded construction contracts earlier than the allowable start of the construction period of performance, when funding availability wasn’t an issue.

@FLContracts  If I were you and this isn’t an isolated incident with management, I would look for another job.  There’s likely  a lot of frustration waiting for you in the future as well as poor educational experiences.

What are you buying, supplies or services? (It sounds like services, but I want to be sure.)

If services, are they severable or nonseverable?

If services, are funds presently available or will they become available in the new fiscal year?

Hi Vern!

1. Service
2. Severable 
3. Service Cost Center funds -Unlike annual appropriations, these funds do not expire at the end of the fiscal year. They are "no-year" funds that carry over from one fiscal year to the next.

FLContracts said:

Can anyone point me in the right direction or provide insights on the appropriate regulations or procedures for executing an early award with a delayed period of performance?

DoD?  Have you considered DFARs 215.371?

FLContracts said:

The projected award date stated in the solicitation was Apr 30th,

Even if you can comply with 215.371 the above raises concern for me.  Details count which I do not know.  Yet have you given due consideration to the exact statement in the solicitation to assure yourself and PCO that using a different award date is not a material change to the solicitation?  Remember a material change to the solicitation would be cause to amend.

The afterthought is your use of "bid".  I suspect offer or maybe quote, RFP or RFQ.  Either way if stated award date would give cause to change an offerors response to award evaluation factors, it could be material.

Maybe just maybe management has good cause for needing a well researched decision to go forward as you are suggesting.

The original post has been clarified that the delay in beginning performance  is two months, within the same fiscal year.

And the anticipated date for start of performance doesn’t change. There would be no cardinal change by early award with the same period of performance. The incumbent would be well aware of the time to perform the new contract. 

FLContracts said:

The projected award date stated in the solicitation was Apr 30th, and the current contract expires on May 1st.

My PCO and I are considering awarding the contract on Feb 1st but with an effective date and period of performance starting on APR 30th. Essentially, we'd be making an early award with a delayed period of performance.

What’s the problem?? 

This is apparently DOD (“FMR” referenced), so DFARS 215.371-3 would be applicable when only one proposal is received.

Actually, if additional data is necessary to determine reasonableness, the parties could be negotiating anyway and the early award with same start of performance can be clarified…

Even if price negotiations aren’t necessary, the government could ask the proposer if there is any problem with early award but I doubt that the incumbent would have any objection.

Thank you for pointing out DFARS 215.371. However, that provision relates to only one offer being received, which is not the core issue I'm facing here. All required one bid/offer procedures were properly followed, and price reasonableness has been established. My question centers specifically on the timing of award versus the effective start date/period of performance.

The core question is whether there is any regulatory prohibition against awarding the contract 3 months prior to the planned period of performance start date, which is an unusual timeframe separation.

From my research, I could not find any FAR or DFARS restrictions that would prevent making an award well in advance of the required performance start date.

Management's concern around ensuring there is a solid regulatory basis for separating the award and performance dates by 3 months is understandable, as that is likely an atypical timeframe gap in most procurements.

However, absent any specific FAR/DFARS prohibitions, I don't see any regulatory issues with proceeding as planned - awarding early while still starting the period of performance when the incumbent contract expires.

The alternative of just holding the award for 10 weeks until closer to the performance start date is certainly an option. But if there are no downsides to awarding earlier, that may help streamline the process.

Your “management’s” concern is ridiculous. 

If there is no regulatory prohibition, no problem with funding, the offeror is the incumbent and DFARs already put you into an effective sole source procedure where you can negotiate/clarify,  you can amend the solicitation to specify the the official start date of the period of performance far the record. Get the offeror’s concurrence before awarding…

Then everything is clean.

The OP posted yesterday, June 19, and wrote:

On 6/19/2024 at 6:17 AM, FLContracts said:

The projected award date stated in the solicitation was Apr 30th, and the current contract expires on May 1st.

My PCO and I are considering awarding the contract on Feb 1st but with an effective date and period of performance starting on APR 30th. Essentially, we'd be making an early award with a delayed period of performance.

I don't understand. This is June 2024. Is the OP talking about February, April and May of 2025? Is the OP talking about backdating an award?

If I were the incumbent contractor I would be concerned about the implications of an "early" award. Might it make them obligated to comply with various new socio-economic contract clauses even if they weren't being paid for complying with them? Don't claim to know the answer unless you can cite case law.

If the effective date were set far in the future, would the early "award" obligate funds?

In general, what does the case law say about the implications of a contract "effective date"? (Don't say it's obvious. The phrase appears in 3,147 BCA decisions, and is at the heart of the issue in many of them.) Should the contract itself spell out the situation and agreement?  How is "effective date"  coordinate with other terms of a contract? Do we know the contract type?

What does the junior contract specialist know about "the color of money and funds"? What's the difference between "money" and "funds"? To what does "color" refer?

Why award "early"? Why not just ask the contractor to write a letter extending the acceptance period of its offer?

I'm a geezer with limited vision, so please, help me understand what I have missed.

I want to point out that Carl (C_Culham) is the only member to have raised questions and expressed doubts about "early" award.

Vern, the OP revised the initial post concerning the dates. The original hypothetical dates were in different fiscal years.

Under the overall stated circumstances - dealing with a single proposer, under DFARS 215.371-3, not a cardinal change to the solicitation that would affect competition, same funding for the award date and start date, the government could negotiate the change in the award date with the offeror.

The government could initially include a similar award date two months earlier earlier than start of performance in the same fiscal year in a solicitation, can’t they?

So why can’t they amend the anticipated award date prior to award as long as the sole offeror agrees?

joel hoffman said:

So why can’t they amend the anticipated award date prior to award as long as the sole offeror agrees?

Why do you ask me that? I didn't say they CAN'T do it. I'm not worried about a protest or a violation of statute or regulation. And regulations are not the only issues.

Did you read my post?

I wonder why they want to do it and what the implications might be.

What are your responses to the issues I raised? 

If we are going to respond to this junior contract specialist and others, we should respond like thoughtful pros, not half-baked social media stars, popping of "analyses" based on vague scenarios. And we should teach them how to properly present a scenario.

Let's teach him/her to think things through.

Maybe I’m not looking at this properly but it seems like a very simple issue.  We are overly complicating things in my opinion.

Using the OPs dates, the incumbent has a contract expiring on May 1. The OP wants to make a new award on February 1 with an effective date of April 30 [recognizing those dates might be switched].  The incumbent won’t have to comply with new contract conditions and terms early.  Nor is there a cardinal change in the solicitation.  Funding is non-expiring.  The alternative is asking the incumbent to extend his proposal offer to April 30 if it lapses before then and delay the new contract until late April.

On 6/19/2024 at 7:17 AM, FLContracts said:

I'm reaching out for some guidance on a situation I'm facing as a junior contract specialist...

Can anyone point me in the right direction or provide insights on the appropriate regulations or procedures for executing an early award with a delayed period of performance? Any guidance would be hugely appreciated as I navigate this situations.

All:

FLContracts did not ask whether it is legal or "okay" to award early. I don't know of any rule against awarding a contract ahead of the date on which performance is to commence. I presume that most contracts are awarded before performance is to commence. But the OP, a junior contract specialist, asked for "guidance". Their superiors seem to be unsure in this case. So they came here. We should help them think it through.

My guidance is that the OP, starting out in their career, should consider all possible implications. In this case, FAR 15.206 does not seem to be a consideration. But there are others.

The legal significance of the "effective date" of a contract, as indicated, perhaps, on a contract form such as SF 26, Block 3, or SF 1449, Block 3, without further contractual explanation and stipulation, are far from clear, as any scan of the case law soon reveals. BTW, SFF 1449 says Award/Effective Date. What does that mean?

Are the implications of effective date the same under a fixed-price contract as under a cost-reimbursement contract or a time-and-materials contract? I may have missed it, but I don't think the OP mentioned a contract type.

What kind of a service to people like FLContract are you all providing here? You're supposed to be old salts. Well, if you are, then teach them to look out for rocks and shoals.

I'm as experienced as anyone here, more experienced that most. My writings have been cited more than 20 times by the Court of Federal Claims, even more in law reviews. This is my 50th year in the business, but I would hesitate before awarding a contract three months before performance is to begin. I would want to think it through and consult my lawyer, especially if my superiors told me to look into it. I would want to make sure I haven't overlooked something.

FLContracts came here to learn. What have they learned from you?

FAR 1.102 is not the answer to everything. I'm not sure it's the answer to much of anything.

formerfed said:

The incumbent won’t have to comply with new contract conditions and terms early.

Well I would leave that to the OP to answer.  As it goes we are given a sliver to build a house.

formerfed said:

Nor is there a cardinal change in the solicitation.  Funding is non-expiring.

Has the OP checked SAM.gov for views of thr solicitation?  Has the OP canvassed the market to see why nobody "bid"?  Regardless of any "shall" in the DFARS what else has the OP done to be confident that competition to the maximum amount practicable has been achieved?   Are the OPs eyes, and yours, as open wide as GAO's?

All in all I am not as confident as many.  Why?

Title of post - "Early award"  As compared to what exactly?  

And "Delayed period of performance"  Maybe clarified or not but I have not seen the solicitation?

The opening post -

"bid" suggests a casual approach to me...what is it really?  RFP seems true but..????

No reference by the OP regarding the DFARS citation I provided, but now everything is cool?

I will stop here as Vern posted as I was drafting and my thoughts are along the same line of thinking.

My final thought.  The OP wanted a thumbs up.  Some gave it too quickly in my book and I would dare say sent the OP off and running with just the response hoped for!

Just now, C Culham said:

The OP wanted a thumbs up.  Some gave it too quickly in my book and I would dare say sent the OP off and running with just the response hoped for!

Bingo! Ditto!

If being thorough is making it too complicated, I'll go for too complicated.

I completely agree we should help FLContracts and others to learn here.   People will come here to inquire

C Culham said:

Well I would leave that to the OP to answer.  As it goes we are given a sliver to build a house.

Has the OP checked SAM.gov for views of thr solicitation?  Has the OP canvassed the market to see why nobody "bid"?  Regardless of any "shall" in the DFARS what else has the OP done to be confident that competition to the maximum amount practicable has been achieved?   Are the OPs eyes, and yours, as open wide as GAO's?

All in all I am not as confident as many.  Why?

Title of post - "Early award"  As compared to what exactly?  

And "Delayed period of performance"  Maybe clarified or not but I have not seen the solicitation?

The opening post -

"bid" suggests a casual approach to me...what is it really?  RFP seems true but..????

No reference by the OP regarding the DFARS citation I provided, but now everything is cool?

I will stop here as Vern posted as I was drafting and my thoughts are along the same line of thinking.

My final thought.  The OP wanted a thumbs up.  Some gave it too quickly in my book and I would dare say sent the OP off and running with just the response hoped for!

What does asking grilling questions on ensuring competition and determining price reasonableness when only one offer received have to do with FLContracts question?   These kind of questions like an auditor might ask just drives people away.

@formerfed 

Just now, formerfed said:

I completely agree we should help FLContracts and others to learn here.

Good! But did this comment provide FLContracts with guidance about early awards?

On 6/19/2024 at 11:49 AM, formerfed said:

@FLContracts  If I were you and this isn’t an isolated incident with management, I would look for another job.  There’s likely  a lot of frustration waiting for you in the future as well as poor educational experiences.

Maybe the management was testing FLContracts' initiative and research skills.

I'm over here wondering whether the contractor's costs, incurred after award date but prior to effective date, are allowable costs? Do they meet the definition of "pre-contract cost" found in FAR 31.205? If not, what are they?

here_2_help said:

I'm over here wondering whether the contractor's costs, incurred after award date but prior to effective date, are allowable costs? Do they meet the definition of "pre-contract cost" found in FAR 31.205? If not, what are they?

That’s one possibility why one would discuss the idea with the sole offeror!!! One wouldn’t simply unilaterally decide to amend the stated terms to award early without first discussing  (negotiation).

joel hoffman said:

That’s one possibility why one would discuss the idea with the sole offeror!!! One wouldn’t simply unilaterally decide to amend the stated terms to award early without first discussing  (negotiation).

Emphasis added.

The OP did not express any desire to change ("amend") the terms of the solicitation. Here's what the OP said:

On 6/19/2024 at 6:17 AM, FLContracts said:

I'm reaching out for some guidance on a situation I'm facing as a junior contract specialist. I'm working on a procurement where we received only one bid from the incumbent contractor. The projected award date stated in the solicitation was Apr 30th, and the current contract expires on May 1st.

My PCO and I are considering awarding the contract on Feb 1st but with an effective date and period of performance starting on APR 30th. Essentially, we'd be making an early award with a delayed period of performance.

That's it. The OP did not say they wanted to change the contract period of performance, and solicitations do not usually commit the government to a particular award date. Award date is not necessarily the same as the performance start date. The OP did not say why they wanted to award "early".

You would not need a solicitation amendment in order to award sooner than anticipated if such award would not affect the period of performance. or other contract terms. But before just going ahead and awarding earlier than anticipated and months in advance of the specified start of contract performance  a CO should try to determine what if any legal and practical issues might arise, such as precontract costs, especiaily if the contract is cost-reimbursement, incentive, or T&M. That, I believe, was here_2_help's point.

And "effective date" is not a simple idea. Do some research. Go to Google Scholar, select "case law", the select "Federal courts" and search for "contract effective date". You would get even more hits at Westlaw. I have not read and analyzed all the decisions, but I can see that issues have arisen that parties did not anticipate and that were not necessarily simple in nature.

Look, the bottom line is that Wifcon Forum did not serve FLContract well in this case. Note that I was the first to post a response and then withdrew it, because I realized that the issue was more complicated than the OP seemed to realize and that I did not have time to deal with it properly. Those who did post quickly did not provide good guidance. Good guidance might have been:

I know of no statute or regulation about awarding a contract months before performance is set to begin, but doing that may give rise to issues that are complicated, dicey, and unanticipated, and that are not necessarily resolved by the contract effective date. Identifying and resolving them requires many more facts than you have provided, e.g., contract pricing arrangement. It appears that you do not understand that. So I advise that you sit down with your lawyer, the requiring activity, and the prospective contractor and talk it over.

I should have taken the time to write that. My bad.

If the government wants to “award early” and delay start of performance, which wasn’t indicated in the solicitation, it can discuss this and any implications with the sole offeror prior to award. This would be consistent with the DoD procedures for when only one offer is received.

In the revised hypothetical scenario, there would be a two month delay within the same fiscal year.

The OP apparently revised the scenario  in the original opening post to simplify and respond to the questions over crossing fiscal years, which was described in the original scenario.

Yes, the OP should consult with their legal representatives and whoever wants to award early, as well as the contractor.

And the solicitation should be amended if necessary after such discussions, before award to reflect any change in price and to indicate any delay between award and start of performance.

On 6/19/2024 at 6:17 AM, FLContracts said:

The projected award date stated in the solicitation was Apr 30th, and the current contract expires on May 1st.

My PCO and I are considering awarding the contract on Feb 1st but with an effective date and period of performance starting on APR 30th. Essentially, we'd be making an early award with a delayed period of performance.

@joel hoffmanThe OP said the solicitation "projected" an award date of April 30. I presume the start of performance would have been either April 30, May 1, or May 2, but the the OP did not make that clear.

They received one proposal and want to accept it ("award") on February 1 instead of April 30. The OP did not say why. Maybe just to get it over with. Might have been an anti-preaward protest tactic. Who knows? In any case, i do not see any need to amend the solicitation, and I wouldn't do so. Besides, see FAR 15.206(c).

The "delay" would be the gap between the February 1 award date and the April 30th effective date.

The issue that would concern me is whether anything that happens during the gap between the February acceptance date 1 and the April 30 "effective date" might affect the rights and duties of the parties. The parties might decide not to worry about it. Or they might decide to meet, think about it, and discuss it.

What would you do? Knowing you, I'd bet you'd want to do the latter. What if it were an FFP construction contract and some human or natural cause affected site conditions after award but before the effective date? (I don't know the answer to that.)

@Vern Edwards Point taken.  Thanks for the reminder.

As previously mentioned, I’d discuss it.

I was just going to leave this thread, but I can not.  My delayed response is a result of travel, some thinking, some research and further comments as the thread continues.

In reverse order -

joel hoffman said:

If the government wants to “award early” and delay start of performance, which wasn’t indicated in the solicitation, it can discuss this and any implications with the sole offeror prior to award. This would be consistent with the DoD procedures for when only one offer is received.

It depends, I hope anyone following this thread does seek DoD guiding principles in DFARS 215.371 to know what is consistent with regulation (DFARS).

On 6/21/2024 at 7:15 AM, formerfed said:

What does asking grilling questions on ensuring competition and determining price reasonableness when only one offer received have to do with FLContracts question?

I am concerned about this view.   People called out management and now call out a Forum whose intent is to provide guidance.  In my view any poster should be ready for hard questions offered for a hoped for response from the poster or offered as simply rhetorical to make the poster think.   Not just hey you will be fine, go fot it.   I would suggest answering the hard questions is best prior a poster moving forward on a matter presented to Forum.   I think it is the professional way to proceed.

On 6/21/2024 at 7:15 AM, formerfed said:

These kind of questions like an auditor might ask just drives people away.

I think most of the responses have not respected Rule 20. of Forum.  Likewise I was reminded of this thread which I think has been slipped to the shadows over time.

/threads/5498-how-should-we-respond-to-poster-s-questions 

Overall this is my best attempt on my part to provide references to support my "I think" about the course of the discussion in this thread.    I do wonder?   Is this discussion thread emblematic of a constant theme that seems to crop up in many Form discussions?   The quality of the current work force?   Afterall I learned very early on in my career to be prepaed to face hard questions to defend my position on a matter to any and all, both inside and outside the walls of government.   I may be mis-reading but the replies came across to me as " Because I said so".   I hope the OP does not replicate and simply say to management "Because _____________ said so and you should not even have asked me to defend my (and the PCO's) recommended course of action."

C Culham said:

It depends, I hope anyone following this thread does seek DoD guiding principles in DFARS 215.371 to know what is consistent with regulation (DFARS).

I am concerned about this view.   People called out management and now call out a Forum whose intent is to provide guidance.  In my view any poster should be ready for hard questions offered for a hoped for response from the poster or offered as simply rhetorical to make the poster think.   Not just hey you will be fine, go fot it.   I would suggest answering the hard questions is best prior a poster moving forward on a matter presented to Forum.   I think it is the professional way to proceed.

Bringing up price reasonableness again, especially after FLContracts said pricing is fine, and questioning why competition wasn’t received is off topic.  Questions like that also frustrate and intimidate people from asking questions here.  We’re supposed to answer questions and help.  Not bring up a bunch of “got ya’s”

So we disagree.  You say it’s the professional way to proceed.  I say it’s too typical of the 1102 workforce - reacting out of fear of criticism and protests

And who the heck is going to protest an acquisition they didn’t participate in because why? The government decided to make an earlier award but the performance time doesn’t change? Gimme a break already.

formerfed said:

Bringing up price reasonableness again, especially after FLContracts said pricing is fine, and questioning why competition wasn’t received is off topic.

I agree that there is no reason to question the award or the pricing in connection with the OP's inquiry.

The issue for me is the three month gap between the date of award and the date on which the contract will become effective. The OP's management seems to be uncertain about it and has tasked the OP to look into the matter. The OP should not go back and say, "No problem" based on the responses they got here without first trying to understand and report what, if any, the potential implications might be. 

Why award so far in advance? What's the rush? What are the apparent advantages and possible disadvantages of doing such a thing? If I were the boss I would not be pleased if the OP came back to me and said they posted at Wifcon and were told "no problem" and "see FAR 1.102"

I think the OP's management's assignment was an opportunity to learn. When I ran an office and a trainee or a junior specialist asked about something like that I would often say, "Research it and come back and tell me what questions you asked yourself, what your research sources were, and what answers you found. Some of my trainees told me years later, when they ran shops of their own, that they learned a lot that way.

But it appears that there are two schools of thought here Let's call them "pragmatically expeditious" and inquisitively cautious," and that they cannot be reconciled among the participants in this forum.

After 50 years, I am happy in this case to be inquisitively cautious.

Hang in there, everybody.

👍🏻

I appreciate all the feedback on my original question. To clarify, this is a CPFF LOE SeaPort Task Order where all work is issued via Technical Instructions (TIs). The term "bid" comes from the Navy's one-bid tripwire guidance. We received one bid from the incumbent, and we negotiated the contract fee down.

Regarding the estimated award date in Section L/M, it clearly states that it's an estimate. Things can change over a year, and if we had multiple bids, our SSEB report and BCM would have taken much longer. In this case, we were able to be ready to award well ahead of PALT.

My original question was whether we can award a contract 90 days before the period of performance start date. Based on my research, there are no regulations prohibiting awarding a contract ahead of the commencement date of performance. However, funding considerations are crucial.

The key factor is the type of funds being used, as outlined in the DOD Financial Management Regulation (FMR). In our case, we're using no-year funds, which allows for more flexibility to cross FY if necessary.

Advantages of early award include:

1. Getting over the protest window earlier, reducing uncertainty (if competitive).
2. Allowing the contractor to prepare for the new contract period, including updating necessary documentation or systems, staff, etc.
3. Enabling current TO to utilize any remaining funds on the current contract and minimize doing a De-Ob
4. Providing more time for the contractor to plan for seamless continuity of services under the new contract terms.
5. Beating PALT, which is a significant efficiency gain.

These advantages contribute to a more efficient contract renewal and start of the new performance period. The early award doesn't change the period of performance; it simply allows for better preparation and utilization of time before the POP begins. My PCO and submitted this for managements! Lets see what they say!

On 6/22/2024 at 10:53 AM, Vern Edwards said:

The issue that would concern me is whether anything that happens during the gap between the February acceptance date 1 and the April 30 "effective date" might affect the rights and duties of the parties.

To Vern's point, I recall a case some years back where there was a gap between the date a cost reimbursement contract was signed and the backdated start date.  In this case, the cost principles were changed in the interim and a dispute arose as to which version applied to the contract.  The version in effect when the contract was signed was favorable to the government while the version in effect on the start date was favorable to the contractor.  Here, the court accepted the contractor's argument.

FLContracts said:

CPFF LOE  Task Order

This fact alone is a very salient piece of information that would have been very helpful with with regard to responding to the original post.

For the good of the order - From now on in Forum my very first question to any post is going to be is the "contract" a standalone contract or an order (task or delivery) under the broad category of multiple award IDIQ contract.

52.216-7, Allowable Cost and Payment (AUG 2018), paragraph (a):

Quote

The Government will make payments to the Contractor when requested as work progresses, but (except for small business concerns) not more often than once every 2 weeks, in amounts determined to be allowable by the Contracting Officer in accordance with Federal Acquisition Regulation (FAR) subpart  31.2 in effect on the date of this contract and the terms of this contract. [Emphasis added.}

What's the "date of this contract"? The date signed or the effective date? I don't know the answer. Might be good idea to include a stipulation in the contract, eh?

Several FAR clauses use the phrase "the effective date of this contract." See, e.g., FAR 52.229-4, Federal, State, and Local Taxes (State and Local Adjustments) (FEB 2013), paragraph (a):

Quote

Contract date means the effective date of this contract and, for any modification to this contract, the effective date of the modification.

Maybe "inquisitively cautious" isn't such a bad approach.

Vern Edwards said:

52.216-7, Allowable Cost and Payment (AUG 2018), paragraph (a):

What's the "date of this contract"? The date signed or the effective date? I don't know the answer. Might be good idea to include a stipulation in the contract, eh?

I believe the case Retreadfed alluded to answered that question. (Was it AT&T? I don't have time to research right now.) The answer provided by the court was "the effective date" not the award date.

here_2_help said:

I believe the case Retreadfed alluded to answered that question. (Was it AT&T? I don't have time to research right now.) The answer provided by the court was "the effective date" not the award date.

I have searched but did not find any case in which a board or the COFC held that "the date of this contract" meant "the effective date", but my research was hasty. I found many cases in which there was an issue as to which of the two dates was applicable to the resolution of a conflict. The fact that in several clauses the FAR makes a distinction between the date of award and the effective date might be persuasive to a board or court.

See: Determining Applicable Statutes and Regulations: What Date Governs?" The Nash & Cibinic Report, March 2004. Excepts quoted:

"The rights of the parties can vary significantly depending upon which version of a statute or regulation applies to the contract. Thus, when statutes or regulations change after the parties have entered into a contract, the question arises whether the new statute or regulation applies to the contract. The general rule is that postcontract regulations do not determine the parties' rights. E.g., Boeing Aerospace Operations, Inc., ASBCA 46274, 94-2 BCA ¶ 46274, 36 GC ¶ 348. The same rule has been followed with respect to statutory changes. See General Dynamics Corp. v. U.S., 47 Fed. Cl. 514 (2000), 42 GC ¶ 388, relying on U.S. v. Winstar Corp., 518 U.S. 939 (1996), 38 GC ¶ 322, and Yankee Atomic Electric Co. v. U. S., 112 F.3d 1569 (Fed. Cir. 1997), 39 GC ¶ 281. However, ascertaining whether a statute or regulation applies to the contract requires consideration of a number of factors. First, the date of contract formation must be determined. Second, the clauses that incorporate statutes or regulations use differing language to describe the event that determines the date of applicable statutes or regulations. Finally, the contract may contain an “effective date” that differs from the date or dates when the written document was signed.

***

There are many FAR clauses that base their coverage on a specified date. Some use the term “date of contract” or “contract date.” See, for example, FAR 52.211-8, “Time of Delivery” (delivery within a specified numbers of days “after date of contract”); FAR 52.216-2, “Economic Price Adjustment- Standard Supplies” (adjustment limited to “established price in effect on the contract date”); and FAR 52.216-13 “Allowable Cost and Payment-Facilities” (allowability determined by Cost Principles “in effect on the contract date”). Other clauses use the term “contract award.” See, for example, FAR 52.222-26 “Equal Opportunity” (application to Office of Federal Contract Compliance Programs to be made within 30 days after contract award); FAR 52.222-49 “Service Contract Act-Place of Performance Unknown” (postcontract wage determination retroactive to date of contract award); FAR 52.230-5 “Cost Accounting Standards-Educational Institution” (adjustment for accounting principle amendment effective after date of contract award); and FAR 52.232-30 “Installment Payments for Commercial Items” (number of payments based on number of months from date of contract award).

***

The term “effective date” has been sometimes used by boards and courts to merely refer to the date that the contract came into existence. See, for example, Brownlee v. DynCorp, 349 F.3d 1343 (Fed. Cir. 2003), 45 GC ¶ 488, and Johnson Management Group CFC, Inc., HUDBCA 96-C-132-C15, 99-2 BCA ¶ 30520. See also the FAR 52.229-3 “Federal, State, and Local Taxes” clause, which states: “‘Contract date’ means the date set for bid opening or, if this is a negotiated contract or a modification, the effective date of this contract or modification.” (Emphasis added.) It is a different situation where the parties designate an “effective date” that is different from the date or dates when the contract was awarded or formed.

• Effective Date Different From Document Execution Date-In some cases, the “effective date” specified in the contract may be prior to or subsequent to the date or dates when the contractor and Government signed the document. The question then is which of the dates govern the clauses incorporating regulations. That issue was present in DynCorp Information Systems, LLC v. U.S., 58 Fed. Cl. 446 (2003). In DynCorp, the letter contract at issue was signed by the contractor on August 27, 1991, and by the Contracting Officer on September 3, 1991. It also stated that the “effective date” was January 1, 1990. The contract contained a “Pricing of Adjustments” clause stating that pricing was to be governed by the Cost Principles “in effect on the date of this contract.” The Cost Principles changed to the detriment of the contractor (that's what usually happens) between the effective date and the date of the parties' signatures. The Government argued that the changed version of the Cost Principles applied. Based on the unique facts of the case, the Court of Federal Claims finessed the question, finding that the “effective date” was the same as the date of contract formation. The contractor had been performing services and the Government had been accepting the services for 20 months prior to the date of the written document. Thus, the court never reached the question of what the result should be when the dates differ.

[Emphasis added. That might be Retread's case.]]

***

As can be seen from the above discussion, determining the date of acceptance depends upon many factors, not the least of which is the still uncertain role of the “mailbox rule.” The Rhode Island Tool decision has yet to be reviewed by an appeals court, and the board decisions distinguishing it on the basis of the changed language are rather sparse. One of the ways for the parties to bring some degree of certainty into their contract is to insert an “effective date” into the contract and to specify that it is the date for purposes of both the contract date and award date clauses. DynCorp suggests that such a date would be enforceable so long as it is not arbitrary. As discussed, having the effective date be the date of the contractor's proposal or the date of negotiations would appear to be sufficiently grounded in substance to warrant enforcement. However, including such a meaningful date would require communications between the parties and that is not possible in sealed-bid procurements or in some negotiated contracts.

[Emphasis added.}

We think that the FAR is deficient in several areas. First, there is no reason that clauses should use differing language. Our first recommendation would be to use the same language for all clauses and that would be the contract date. Second, the FAR should address the effective date issue. As several of the cases we discussed indicate, there can be a significant time period between submission of proposals and negotiation on one part and acceptance on the other. Changes in statutes or regulations can have a significant impact on the risks assumed by the parties. Merely having an “effective date” block in SF 26 and Optional Form 307 is not sufficient. Procurement personnel should be advised why, and under what circumstances, an effective date should be inserted. After all, the purpose of having a contract is allocation of risk."

Emphasis added.

Cautious inquiry advised.

Vern Edwards said:

Emphasis added. That might be Retread's case.]]

Yes it was.  As I recall, the contractor regularly billed the government using the cost principles in effect on the effective date shown on the contract document and the government reimbursed the contractor without question.  It was only after the contract was signed did the government question which cost principles applied.  The court based its decision on what it perceived to be the intent of the parties.

Retreadfed said:

Yes it was.  As I recall, the contractor regularly billed the government using the cost principles in effect on the effective date shown on the contract document and the government reimbursed the contractor without question.  It was only after the contract was signed did the government question which cost principles applied.  The court based its decision on what it perceived to be the intent of the parties.

Is this the case you’re referring to?

http://www.cofc.uscourts.gov/sites/default/files/opinions/MILLER.DynacorpInfoSys.pdf

Then it’s important to mutually agree to an “effective date” for the new task order…

From the latest explanation by the OP, they apparently want the contractor to do predatory planning before the start of the level of effort work.

joel hoffman said:

Then it’s important to mutually agree to an “effective date” for the new task order.

According to Cibnic and Nash, "Merely having an 'effective date' block in SF 26 and Optional Form 307 is not sufficient."

Vern Edwards said:

According to Cibnic and Nash, "Merely having an 'effective date' block in SF 26 and Optional Form 307 is not sufficient."

So I want to back up on this thought and your very helpful additional information.  Offered as thoughts for all not just you Vern so I hope you take my comments as intended.  Just further thoughts about the matter of effective date.

With it now stated that the matter relates to a Task Order under a multiple award IDIQ I think consideration, maybe paramount consideration, should be give to the terms and conditions of the parent IDIQ.   I may be getting too far into the weeds but I pulled up the most current conformed copy of the parent IDIQ solicitation which I think represents the awarded parent contract that the original poster is anticipating award of the Task Order under.  thoughts that in truth may not present an issue but all the same here are some facts from the parent solicitation that again I think represents an awarded IDIQ that the original poster is dealing with.  I do realize in making my comments that the contractor for award is also the incumbant of a previous task order.

--In the terms and considitions I found six references to effective date.  None seem to help address the issues of this thread, most especailly the funding part.

--Lots of mentions of this or that at "award".

--How about this statement as compared to any use of award or effective date - "Sponsorship can begin as soon as the Task Order Contracting Office has determined the contract awardee."

-- Neither here nor there regarding this instant matter I just found this an interesting limitation on use of the IDIQ's when it sounds like in this particular case going through the motions of Task Order competition is just that, motion.   "There is no direct ordering or sole source."

-- What started me on my quest after the OP's detail regarding a Task Order is the mention of "protest".  I do backstep on my concerns in part but then I found the discussion in the parent solicitatin/contract regarding omsbudsman interesting. 

--  That is enough on my part except to note that the following regarding FAR clauses in the parent -  FAR 52.229-4(No),  FAR 52.216-7 (Yes) with this interesting reference _"_Payment request. The Contractor shall ensure a payment request includes documentation appropriate to the type of payment request in accordance with the payment clause, contract financing clause, or Federal Acquisition Regulation 52.216-7, Allowable Cost and Payment, as applicable."

Offered again not to indicate anything what so ever right or wrong just that  "inquisitively cautious" should include the terms and conditions of the parent contract as there may or may not be something in it that helps sort out anything that may be considered an effective date or the like.  

Reference - N0017824R7000_RFP_Conformed Copy_04_23_2024.pdf

C Culham said:

Offered again not to indicate anything what so ever right or wrong just that  "inquisitively cautious" should include the terms and conditions of the parent contract as there may or may not be something in it that helps sort out anything that may be considered an effective date or the like.

@C Culham Carl, I agree with that.

On 6/19/2024 at 10:08 AM, ji20874 said:

To answer your question:  Will FAR 1.102(d) work for you?

Some posters here did not approve of my comment above, but I see no problem with it.  If anyone would read the FAR text, they would see that use of FAR 1.102(d) as "authority" requires some effort -- it only fits if the approach in question evidences "sound business judgment" and "is i__n the best interests of the Government."  It takes some professional thinking to arrive at conclusions in these matters, and I hope the OP is able and willing to apply some professional thinking to his or her question.  I see nothing in this thread suggesting that OP has read the cited FAR text.

ji20874 said:

Some posters here did not approve of my comment above, but I see no problem with it.  If anyone would read the FAR text, they would see that use of FAR 1.102(d) as "authority" requires some effort -- it only fits if the approach in question evidences "sound business judgment" and "is i__n the best interests of the Government."  It takes some professional thinking to arrive at conclusions in these matters, and I hope the OP is able and willing to apply some professional thinking to his or her question.  I see nothing in this thread suggesting that OP has read the cited FAR text.

I think all of the above is true. I did not approve of the comment, and said so.

I did not approve of the comment because most people do not read FAR text as deeply as they should or have the education and experience needed to interpret and apply it.

FAR 1.102(d) says:

Quote

The role of each member of the Acquisition Team is to exercise personal initiative and sound business judgment in providing the best value product or service to meet the customer’s needs. In exercising initiative, Government members of the Acquisition Team may assume if a specific strategy, practice, policy or procedure is in the best interests of the Government and is not addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, that the strategy, practice, policy or procedure is a permissible exercise of authority.

Nice-sounding words. But a self-proclaimed "junior contract specialist" (and many senior contract specialists) have no idea how to apply FAR 1.102(d). They do not yet have the organizational resources or the personal skills needed to research strategies, practices, policies, and procedures and the mass of "case law" that has been applied to them. They would not come here seeking "insights" and "guidance" if they did.

There will soon be published in The Nash & Cibinic Report a 6,300+ word essay by a Federal judge that lays out the issues concerning determination of who is an "interested party" under the Tucker Act. A junior contract specialist who reads it, even one with a law degree, will learn how difficult it is to sort out procurement strategies, practices, policies, and procedures. I have all the organizational tools and personal skills that anyone could ask for in this business and 50 years of experience from GS-05 to GS-15, which include many years as a teacher, researcher, and writer, and I can't always do it. I had to read the judge's draft several times.

FAR 1.102(d) was written by people who wanted to sound encouraging. I have cited it many times. But the truth is that citing it in response to a request for insight and guidance from a self-proclaimed junior contract specialist, who did not ask a clear question and did not provide essential context, and leaving it at that is an act of futility and dismissal. And so is saying that delving into a matter more deeply is only making things more complicated.

Things are complicated, very complicated. Which is why they must be delved into. Deeply.

This scenario would also be somewhat applicable to an option exercise ("is there such a thing as exercising an option too early?").

What if your awardee ends up on the SAM/PPIRS naughty list between award and start of the PoP?  What if their SAM registration expires before the start of the PoP? The FAR requires a CO to check SAM for exclusions immediately before award (I was dinged in an audit for checking SAM the morning of the award, which occurred later that afternoon.) The obvious intent is to make sure you're not awarding to an ineligible vendor.  "They were fine when I checked them 2 months ago" won't fly.

What is the upside of awarding early?  Of all the posts on this topic I have yet to see anyone justify why it's in the best interest of the Government to award months before the start of the PoP (e.g., for supplies, supply chain lead-time might be a justification).

REA'n Maker said:

Of all the posts on this topic I have yet to see anyone justify why it's in the best interest of the Government to award months before the start of the PoP...

You list one example.  We do not know the OP's reason, but there are many, many reasons that an experienced professional could imagine where it might make sense to have a space of time before date of award and the start of the performance period.

REA'n Maker said:

What is the upside of awarding early?

Just now, ji20874 said:

We do not know the OP's reason...

Pay attention, people. The OP recently posted this:

On 6/24/2024 at 7:36 AM, FLContracts said:

Advantages of early award include:

1. Getting over the protest window earlier, reducing uncertainty (if competitive).
2. Allowing the contractor to prepare for the new contract period, including updating necessary documentation or systems, staff, etc.
3. Enabling current TO to utilize any remaining funds on the current contract and minimize doing a De-Ob
4. Providing more time for the contractor to plan for seamless continuity of services under the new contract terms.
5. Beating PALT, which is a significant efficiency gain.

ji20874 said:

there are many, many reasons that an experienced professional could imagine where it might make sense to have a space of time before date of award and the start of the performance period.

There are many, many reasons that an experienced professional could imagine where it might not make sense to have a space of time before date of award and the start of the performance period.

Vern Edwards said:

Pay attention, people. The OP recently posted this:

Yes, but what on that list is in the Government's best interest?  "Beating PALT" is administrivia, "closing the protest window earlier" doesn't make a protest less likely to occur (and there is pretty much 0% chance a protest would be resolved by the start of the PoP anyway), "Enabling current TO to utilize any remaining funds on the current contract and minimize doing a De-Ob" has nothing to do with an early award, and "providing the contractor more time to plan" is pure conjecture and begs the question of unauthorized pre-contract costs.

So, my question still stands.  For the record, my point was more existential in nature, as in "every CO should ask themselves this question as Step 1".

Just now, REA'n Maker said:

So, my question still stands.

How about:

Allowing the contractor to prepare for the new contract period, including updating necessary documentation or systems, staff, etc.

and

Providing more time for the contractor to plan for seamless continuity of services under the new contract terms.

I don't think the latter is "pure conjecture", but even if it is, it's not unreasonable conjecture.

Vern Edwards said:

How about:

Allowing the contractor to prepare for the new contract period, including updating necessary documentation or systems, staff, etc.

and

Providing more time for the contractor to plan for seamless continuity of services under the new contract terms.

I don't think the latter is "pure conjecture", but even if it is, it's not unreasonable conjecture.

1. Would you say it's appropriate for the government to engage with the new contractor during the limbo between award and PoP start date?  Or is the presumption that the vendor do all the planning and preparation and hope for the best? Every transition I've been involved with requires government involvement and approval.
2. Can the new awardee engage with the existing vendor when planning their seamless continuity of services?  Seems kind of pointless otherwise.
3. 99% of government contracts are not awarded early and yet all the stuff you mention happens anyway. i.e., "early award" is clearly not required for proper transition planning.  Where is the data that suggests otherwise?

Conjecture or not, contractors taking any action related to a contract with no coverage is a risk.  And when they file their claim the Government will be on record as tacitly encouraging them to incur those costs. 

Is it reasonable to assume all these actions can be accomplished at no cost?

[* The rationale I've seen so far reads like a "parade of horribles"]

Vern Edwards said:

How about:

REA'n Maker said:

contractors taking any action related to a contract with no coverage is a risk.

The discussion is great with regard to a "new" contractor.   Great because it does generate thoughtful considerations.  

For the instant matter my mind just keeps going back to -  "Incumbant contractor"; a "CPFF Task Order" where we know nothing about how many Task Orders, other than the one eluded to, have been held by the contractor;  by the way I think LOE should really be "term" as I think LOE is redundant; an inability to sole source where competition amongst IDIQ holders was required; and maybe more if I thought hard.    

So how about this reasoning -

The task order was competed under an IDIQ.  The sole  contractor who has responded has been performing the same work adequately.  There is no statute, regulation or policy that prevents use of the specific funding on this ORDER for award to occur on XXXX.  Therefore, early award will obligate the money so that it is not lost and allow the contracting office to move on to other matters.  At award direction will be given to the contractor that incurring any costs prior to the stipulated performance period start date will be at the sole risk of the contractor.  (Here one might indicated what exceptions, if any.)

REA'n Maker said:

Would you say it's appropriate for the government to engage with the new contractor during the limbo between award and PoP start date?

Let's assume that the award is not conditioned upon the availability of funds.

That being the case, my answer is yes, it's appropriate.

REA'n Maker said:

Or is the presumption that the vendor do all the planning and preparation and hope for the best?

No.

REA'n Maker said:

Can the new awardee engage with the existing vendor when planning their seamless continuity of services?

Yes. The question is whether the existing contractor is obligated to cooperate with its replacement.

REA'n Maker said:

99% of government contracts are not awarded early...

I don't know that to be true. Please cite the source of your facts, presuming you have any. Or is your assertion merely presumptuous? 

REA'n Maker said:

... "early award" is clearly not required for proper transition planning

I would say that depends on why you mean by "early"? I don't think "proper" would ordinarily include awarding a complex contract the day before performance is to begin. Do you? It seems reasonable to say that any contract should be awarded sufficiently in advance to permit the parties to coordinate. Wouldn't you agree? And what if the contract were awarded "without discussions"? And what kind of contract are you talking about?

On 6/25/2024 at 9:38 AM, Vern Edwards said:

FAR 1.102(d) was written by people who wanted to sound encouraging. I have cited it many times. But the truth is that citing it in response to a request for insight and guidance from a self-proclaimed junior contract specialist, who did not ask a clear question and did not provide essential context, and leaving it at that is an act of futility and dismissal.

I think the problem with simply citing FAR 1.102(d) to anyone, especially young workforce members, is that the suggestion is incomplete.  This FAR paragraph is only an invitation to research concepts that the FAR does not restrict or supplement.  It is not an invitation to innovate based on what you feel is sound business judgment.  That is pure hubris.  But that is all we will get from our people if we don't teach them how to research and take notes.  The trick is getting to the kids before DAU or FAI frames success in this career field as a solving a puzzle or open-book quiz.  It's more like a mystery with no end.

I guess I am essentially writing of the difference between training and education.

Voyager said:

I guess I am essentially writing of the difference between training and education.

EDUCATION: Concepts, Principles, Rules

TRAINING: Processes, Procedures, Techniques