Can FAR Clause be added at award not in the RFQ?

Your recourse is to negotiate for more money and risk losing the offer of award. You don't want to protest because you're the "apparent successful vendor."

You said "RFQ." The RFQ was not an offer. Your quote was not an offer. The government is providing you an offer now. You can accept the offer, reject the offer, or negotiate for a better offer.

You should probably start with a phone conversation.

PepeTheFrog said:

Your recourse is to negotiate for more money and risk losing the offer of award. You don't want to protest because you're the "apparent successful vendor."

You said "RFQ." The RFQ was not an offer. Your quote was not an offer. The government is providing you an offer now. You can accept the offer, reject the offer, or negotiate for a better offer.

You should probably start with a phone conversation.

LBF, I think that Pepe is correct and that a phone call is a good starting point. I’d seek to understand why the additional clause is necessary. Then, you might advise what the impact is.

So, they might not award to you or they might amend the RFQ and seek revised quotes. 

Either way, if you will lose money by accepting the additional terms, it may be better to be able to revise your quote, if allowed to, and take your chances on being the eventual selectee than to lose money on the deal.

Thank you both. Excellent advice.

LBF said:

Can a CO add a FAR clause to a GSA schedule task order award that was not in the RFQ, nor part of the GSA schedule contract itself?

Here is a blog that may also help....https://interact.gsa.gov/wiki/adding-provisionsclauses-rfqs

Carl, the apparent problem here is that the contracting officer is adding the clause or clauses after receiving quotes. In my opinion, government needs to put its cards on the table Before requesting quotes, not afterward, whenever possible. If they can’t do that, then the government shouldn’t be surprised that modifying the conditions and terms may affect the price or other considerations.Some other considerations might be the amount of time that it will take to provide the product or service.

C Culham said:

Here is a blog that may also help....https://interact.gsa.gov/wiki/adding-provisionsclauses-rfqs

The blog discusses using agencies adding or modifying Schedule contract terms and conditions. I didn’t see where it discussed the timing or the effect of timing on the process...

LBF said:

Can a CO add a FAR clause to a GSA schedule task order award that was not in the RFQ, nor part of the GSA schedule contract itself?

Yes, but it would not be contractually enforceable unless the contractor acceded to it, either expressly or by performing without objection.

LBF said:

If not, what recourse does the apparent successful vendor have if it believes the addition of the clause adds substantial costs?

If you commence performance you will likely waive any right to a price adjustment. If you don't want to perform without a price adjustment, then don't commence performance. As others have pointed out, call the contracting officer and express your concerns before you commence performance, and see what you can work out between you.

joel hoffman said:

The blog discusses using agencies adding or modifying Schedule contract terms and conditions. I didn’t see where it discussed the timing or the effect of timing on the process...

Joel - I did not say the blog did but in my view helps the OP understand what adding a clause means.   Vern has answered the question.

Can a CO add a FAR clause to a GSA schedule task order award that was not in the RFQ, nor part of the GSA schedule contract itself? If not, what recourse does the apparent successful vendor have if it believes the addition of the clause adds substantial costs? (bolded language added)

Was this a competitive situation? If so, adding a requirement (that adds or subtracts value) to an award that was not included in the government solicitation for the award, could be challenged as unfair to the other bidders.

Thanks Neil. It was competitive on GSA schedule. We spoke with CO and they will not remove the clause. Thus, we are not accepting the offer. I appreciate all the feedback. Have a nice weekend.

On 5/24/2018 at 5:41 PM, PepeTheFrog said:

You said "RFQ." The RFQ was not an offer. Your quote was not an offer. The government is providing you an offer now. You can accept the offer, reject the offer, or negotiate for a better offer.

One clarification for the benefit of LBF and others: The quoted rationale should not be relied upon for declining orders in the context of the Multiple Award Schedule (MAS) Program. GSA requires its FSS contractors to accept Executive Agency orders under most circumstances (source: https://www.gsa.gov/acquisition/purchasing-programs/gsa-schedules/gsa-schedules-frequently-asked-questions, Is a GSA Schedule contractor required to accept any order placed against its Schedule contract?).

Thus, even though the correct nomenclature when using the MAS Program is "quote," and quotes are not offers under the law, FSS contractors should be mindful that an agency's order must usually be accepted. In OP's situation, the company could decline the order based on the presence of new terms, not because the Government's order is legally an offer.

FrankJon said:

One clarification for the benefit of LBF and others: GSA requires its FSS contractors to accept Executive Agency orders under most circumstances (source: https://www.gsa.gov/acquisition/purchasing-programs/gsa-schedules/gsa-schedules-frequently-asked-questions, Is a GSA Schedule contractor required to accept any order placed against its Schedule contract?).

Thus, even though the correct nomenclature when using the MAS Program is "quote," and quotes are not offers under the law, FSS contractors should be mindful that an agency's order must usually be accepted.

What are you saying? Are you saying that a GSA FSS contractor must accept an order that is inconsistent with the terms of its GSA FSS contract?

Vern Edwards said:

What are you saying? Are you saying that a GSA FSS contractor must accept an order that is inconsistent with the terms of its GSA FSS contract?

No, I am saying that the rationale I quoted is not applicable to this situation. I have no qualms with the advice offered by Pepe and others, but the reason is because the Government introduced new terms (LBF never said they were "inconsistent" with the FSS contract). If an FSS contractor views an order as an offer, and on that basis rejects the order, it risks violating its FSS contract terms.

What if an agency processes an FSS order like a purchase order, by requesting quotes based on agency-specified terms, but then issues a "task order" or "delivery order" with different terms than those originally specified?

Do you think a board or court would react as if the agency had issued a valid task or delivery order? Or do you think the agency's conduct might affect the board or court's decision?

Vern Edwards said:

What if an agency processes an FSS order like a purchase order, by requesting quotes based on agency-specified terms, but then issues a "task order" or "delivery order" with different terms than those originally specified?

Do you think a board or court would react as if the agency had issued a valid task or delivery order? Or do you think the agency's conduct might affect the board or court's decision?

No and yes, because, as I said and many posters here agree, the terms have changed. 

If you'll refer back to Pepe's post, his rationale is based on the legal definition of a quote, not the change in terms. I am cautioning others - especially FSS contract holders - about applying that rationale within the MAS Program environment. (I'm not nitpicking, if that's your concern. Pepe's statements are legally correct and his ultimate advice is sound. But I am pointing out an often overlooked peculiarity of FSS contracting.)

@FrankJon

What prompted my interest in your post is that while we all (or most of us) know what indefinite-delivery contracts are and how they're supposed to work, that's not always how they're being used. GSA FSS contracts are a perfect example of what I'm talking about.

The concept behind those contracts is that they specify deliverables and allow the government to order various quantities of units of those deliverables from time to time and at fixed prices to be delivered to various locations on order. Those contracts and the standard FAR clauses that have been developed for them---52.216-18, -19, and -22---reflect those arrangements. The concept does not reflect the idea of orders that can combine quantities of units into unique units called tasks or an ordering process in which the government seeks quotes for unit price reductions and task prices or seeks to add clauses that are not in the contract. That raises questions about the enforceability of the Ordering clause, FAR 52.216-18:

Quote

Ordering (Oct 1995)

(a) Any supplies and services to be furnished under this contract shall be ordered by issuance of delivery orders or task orders by the individuals or activities designated in the Schedule. Such orders may be issued from __________ through ____________ [insert dates].

(b) All delivery orders or task orders are subject to the terms and conditions of this contract. In the event of conflict between a delivery order or task order and this contract, the contract shall control.

(c) If mailed, a delivery order or task order is considered “issued” when the Government deposits the order in the mail. Orders may be issued orally, by facsimile, or by electronic commerce methods only if authorized in the Schedule.

(End of clause)

Emphasis added. Or the Indefinite Quantity clause, FAR 52.216-22:

Quote

Indefinite Quantity (Oct 1995)

(a) This is an indefinite-quantity contract for the supplies or services specified, and effective for the period stated, in the Schedule. The quantities of supplies and services specified in the Schedule are estimates only and are not purchased by this contract...

Emphasis added.

What is "indefinite" in the IDIQ concept is quantity and delivery, not specifications and other terms. Of course, the standard clauses can be supplemented in ways that do not deviate from FAR.

While what you have said:

FrankJon said:

Thus, even though the correct nomenclature when using the MAS Program is "quote," and quotes are not offers under the law, FSS contractors should be mindful that an agency's order must usually be accepted.

is true if the government simply orders a quantity of specified units that are to be delivered to specified places, I doubt very much that it holds true when the government asks for quotes that include price reductions and specifies tasks that are not described in the base contract. I do not think that GSA FSS contracts are IDIQ contracts in the schoolhouse sense of that term that is taught to most contract specialists, when they are, in fact, used in other ways. I think usage may render the ordering clause unenforceable. Then again, COs who engage in government contracting often show little regard for contracts.

I don't know if my theory has been tested in court, but I think it's unlikely to be tested very often, since GSA FSS contractors seem willing to put up with almost anything in order to get some work, any work, from somebody. But I find the disparity between the expectations built into the standard clauses, on the one hand, and actual practice, on the other, to be very interesting.

Well stated Vern and some of the very concerns I could not articulate when I continued my read of this discussion thread.   I started a post about scope of parent IDIQs (the OP's concerns could strongly suggest a material change) and even one on mistake in quote (Oh, had I known that clause was  in the order I would have added this much more money in my quote!) but could never really get there.  

Vern Edwards said:

Then again, COs who engage in government contracting often show little regard for contracts.

This "Hit the Nail on the Head".

@Vern Edwards , there is a lot to unpack in your post.

• First, I stand by my statement, since it's GSA's term and according to them there is no wiggle room simply because the order is for a service. You may question the enforceability of such a term, but I maintain it would be a high-risk move for an FSS contractor to decline an order based on the legal defense that a quote is not an offer.  
• Second, you said:

On 5/25/2018 at 2:31 PM, Vern Edwards said:

What are you saying? Are you saying that a GSA FSS contractor must accept an order that is inconsistent with the terms of its GSA FSS contract?

and

On 5/25/2018 at 3:16 PM, Vern Edwards said:

What if an agency processes an FSS order like a purchase order, by requesting quotes based on agency-specified terms, but then issues a "task order" or "delivery order" with different terms than those originally specified?

But now you're saying:

On 5/26/2018 at 9:08 AM, Vern Edwards said:

Those contracts and the standard FAR clauses that have been developed for them---52.216-18, -19, and -22---reflect those arrangements. The concept does not reflect the idea of orders that can combine quantities of units into unique units called tasks or an ordering process in which the government seeks quotes for unit price reductions and task prices or seeks to add clauses that are not in the contract.

Which is it that we're talking about here: Conflict between the order terms and base contract terms (the latter of which includes FAR and GSA terms), or conflict between GSA terms and FAR terms? 

• Third, you said:

On 5/26/2018 at 9:08 AM, Vern Edwards said:

The concept does not reflect the idea of orders that can combine quantities of units into unique units called tasks or an ordering process in which the government seeks quotes for unit price reductions and task prices or seeks to add clauses that are not in the contract.

and

On 5/26/2018 at 9:08 AM, Vern Edwards said:

What is "indefinite" in the IDIQ concept is quantity and delivery, not specifications and other terms.

Why not? What is this "concept" based upon? Your highlighted language in 52.216-18 and -22?

If the base contract includes terms stating explicitly that units can be combined into tasks, and that the Government will seek price reductions, and that non-conflicting clauses may be added at the order level, then I see nothing in those clauses that conflicts with subsequent orders taking those actions. (What? Suddenly you're an Originalist, Vern?!)

• Fourth, you said:

On 5/26/2018 at 9:08 AM, Vern Edwards said:

I doubt very much that it holds true when the government asks for quotes that include price reductions and specifies tasks that are not described in the base contract.

I address price reductions above. With regard to "tasks that are not described in the base contract," you're talking about scope. An order outside the scope of a contract or agreement is never permissible or enforceable (without justification), although I agree it happens often. But I fail to see what that has to with the requirement to accept an in-scope order. (The MAS Program uses SINs and LCAT descriptions to determine scope for services. See, for example, here: https://www.gsaadvantage.gov/ref_text/GS10F0257U/0LU95J.2NS2GI_GS-10F-0257U_GS10F0257UPRICELISTKAI.PDF.)

• Fifth, you said:

On 5/26/2018 at 9:08 AM, Vern Edwards said:

I do not think that GSA FSS contracts are IDIQ contracts in the schoolhouse sense of that term that is taught to most contract specialists, when they are, in fact, used in other ways. I think usage may render the ordering clause unenforceable.

To the contrary, I see 52.216-18 as specifically allowing for orders that meet whatever terms the Government writes into the base contract.

• And finally:

On 5/26/2018 at 9:08 AM, Vern Edwards said:

COs who engage in government contracting often show little regard for contracts.

I assume you meant this as an aside. You may not realize the extent to which this is true in the realm of MAS Program ordering, though. Based on significant anecdotal experience, I believe that - conservatively - at least 2/3 of COs never see the Schedule or Terms before placing an order. The idea of scope or conflicting terms never crosses their mind. Indeed, many do not even review the Pricelist.

FrankJon said:

Which is it that we're talking about here: Conflict between the order terms and base contract terms (the latter of which includes FAR and GSA terms), or conflict between GSA terms and FAR terms?

Conflict between order terms, contract terms, and FAR. I don't know that GSA terms conflict with FAR terms. I doubt it. I think GSA appears to adhere to standard IDIQ rules. But I think that GSA has set up the FSS scheme in a way that can lead to agency orders that conflict with contract and FAR terms. That's a view with which you appear to agree:

FrankJon said:

You may not realize the extent to which this is true in the realm of MAS Program ordering, though. Based on significant anecdotal experience, I believe that - conservatively - at least 2/3 of COs never see the Schedule or Terms before placing an order. The idea of scope or conflicting terms never crosses their mind. Indeed, many do not even review the Pricelist.

Finally:

FrankJon said:

I see 52.216-18 as specifically allowing for orders that meet whatever terms the Government writes into the base contract.

So do I. What I don't see is 52.216-18 allowing for orders that include terms that are not in the base contract or that conflict with the base contract. What I also don't see is that the Ordering clause allowing for orders that involve FAR deviations. Unauthorized deviations are unenforceable.

How can a KO change the terms and conditions after receiving a quote, then unilaterally force a schedule contractor to perform under those changed terms and conditions?  In my opinion, the order is unenforceable if the contractor refuses to perform.

 There is no meeting of the minds in such a scenario. Thus there is no mutuality of obligation, which is a necessary element of an enforceable contract.

@joel hoffman, nobody has suggested that to my knowledge.

I've edited my original post for clarity.

On 5/25/2018 at 11:01 AM, FrankJon said:

Thus, even though the correct nomenclature when using the MAS Program is "quote," and quotes are not offers under the law, FSS contractors should be mindful that an agency's order must usually be accepted. In OP's situation, the company could decline the order based on the presence of new terms, not because the Government's order is legally an offer.

@FrankJon

If that's the clarification, it's a confusing one.

FrankJon said:

@joel hoffman, nobody has suggested that to my knowledge.

I've edited my original post for clarity.

FrankJon, my point is that, for the situation here, it doesn’t matter what you call the response to the RFQ. The government can’t require a contractor to accept an order that is inconsistent with the terms and conditions that it has priced, quoted, offered, etc., etc.  -  whatEVER it’s called. I believe that’s what the OP wanted to know. 

The KO apparently changed the terms and conditions after the OP responded to the RFQ and expected the contractor to comply with the changed requirements at no additional cost. 

Possible recourses/options/alternatives were identified.  Accept, reject, try to negotiate...

On 5/25/2018 at 11:31 AM, Vern Edwards said:

Thus, even though the correct nomenclature when using the MAS Program is "quote," and quotes are not offers under the law, FSS contractors should be mindful that an agency's order must usually be accepted.

That was what FrankJon said in his first venture on the topic. The problem is that his point was as clear as mud. What he meant was that a task or delivery order under a GSA MAS contract is an order, a command, that "usually" must be obeyed. The problem with that comment was that he wasn't clear about when such an order is not a command and need not be obeyed.

He has since "clarified" it to read as follows:

On 5/25/2018 at 11:01 AM, FrankJon said:

Thus, even though the correct nomenclature when using the MAS Program is "quote," and quotes are not offers under the law, FSS contractors should be mindful that an agency's order must usually be accepted. In OP's situation, the company could decline the order based on the presence of new terms, not because the Government's order is legally an offer.

Well, sorry, but the addition of another sentence did not clear things up.

I say that the issuance of an order that includes terms that are not consistent with the contract and were not in the government RFQ effectively makes the "order" an offer, which the contractor can treat as such and can accept or reject. Thus far, no harm, no foul. I think that's how many GSA MAS contracts work in actual practice.

But if the contractor refuses to accept, and if the government cites the Ordering clause, insists that the contractor perform the order in accordance with the added terms, and threatens termination for default if the contractor refuses, then the government will have breached the contract, because the order is not consistent with the contract terms, and the contractor would have the basis for a claim. It could refuse to perform and contest any termination or it could render performance accompanied by a concurrent demand for additional compensation. In such a case, the CO would be acting like an idiot and the government like a bully.

I hope this will be the end of this digression, which was prompted by a well-intentioned but ill-considered comment. Let's sum it up this way: GSA MAS contractors---don't go around refusing to perform in accordance with task and delivery orders without (1) thinking things through and (2) seeking the advice of an attorney.

I hope that satisfies FrankJon.

@joel hoffman, @Vern Edwards

1. Pepe provided a rationale for his recommendation that lacked context.  
2. Having done a fair amount of research into the MAS Program, I knew that this rationale could get FSS contractors into trouble if relied upon in situations different from OP's.  
3. I quoted only Pepe's rationale, addressed it, and provided citation.  
4. My mistake, as far as I can see, was believing that it would be evident to the reader that I was addressing only the quoted text, not OP's issue. I've learned something from this.

FrankJon said:

I quoted only Pepe's rationale, addressed it, and provided citation.

I believe that this is the information at the citation that you provided:

Quote

Q: Is a GSA Schedule contractor required to accept any order placed against its Schedule contract? If a Schedule contractor is not obligated to and does not accept my order, how will I be notified?

A: The GSA Order, Eligibility to Use GSA Sources of Supply and Services[PDF - 447 KB], identifies those agencies and activities authorized to use GSA Schedule contracts. For orders above the minimum order specified in each Schedule contract, up to the maximum order threshold, GSA Schedule contractors are obligated to accept orders placed by activities within the executive branch of the federal government. Schedule contractors are not obligated, but are encouraged, to accept orders from agencies and activities outside the executive branch.

If a Schedule contractor is unwilling to accept an order above the maximum order threshold or from an agency or activity outside the executive branch, the order will be returned to the ordering activity within five workdays after receipt by the contractor. For orders that propose payment by the governmentwide commercial purchase card, the contractor must advise the ordering activity within 24 hours after receipt of the order. If the Schedule contractor fails to return the order, or advise the ordering activity, within the specified time frames, the order is considered to be "accepted" by the contractor and all provisions of the Schedule contract shall then apply.

Emphasis added.

The italicized/bolded statement in the quote is not correct. It would be correct if it stated:

For orders that conform to the terms of the Schedule contract and that are above the minimum order specified in each Schedule contract, up to the maximum order threshold, GSA Schedule contractors are obligated to comply with orders placed by activities within the executive branch of the federal government.

That has been the crux of the digressive discussion in this thread.