Types of Contract Confusion

Read this:

Then share it with your QA reviewer.

Don Mansfield said:

Read this:

Then share it with your QA reviewer.

I sure will.  Thank you.  I cannot get them to sign off on the Acq. Plan without me removing "firm fixed price" which would put my solicitation in a pickle.  They will also be reviewing my solicitation for approval.  I'll try to discuss it with them again and show them your explanation.  I hope it helps.

Maybe don't use the term "contract type". Just say the contract will have a firm-fixed price compensation arrangement and an indefinite delivery indefinite quantity delivery arrangement.

You need to Discuss this with you PCO/KO.

What gives your “local QA review” the right to dictate what pricing approach or arrangement you must use? i sense that they want you to use an ID/IQ  contract vehicle but not to identify the type of pricing arrangement. Are they in charge of the Acquisition plan? 

The acquisition team, and I presume, including the PCO, want to use an ID/IQ  with FFP orders. The plan should describe both the ID/IQ format and intended pricing arrangement (I.e., Type, see below).

I don’t know the format prescribed for your acquisition plan. However, it would be stupid not to describe the pricing arrangement for an ID/IQ where the acquisition only intends to issue FFP task orders..

Some FAR References

“Part 7 Acquisition Planning

7.104 General procedures.

…(c) The planner shall coordinate with and secure the concurrence of the contracting officer in all acquisition planning…

7.105 Contents of written acquisition plans.

…(b) Plan of action 

…(3) Contract type selection.  Discuss the rationale for the selection of contract type. For other than firm-fixed-price contracts, see 16.103(d) for additional documentation guidance. Acquisition personnel shall document the acquisition plan with findings that detail the particular facts and circumstances, (e.g., complexity of the requirements, uncertain duration of the work, contractor's technical capability and financial responsibility, or adequacy of the contractor's accounting system), and associated reasoning essential to support the contract type selection. The contracting officer shall ensure that requirements and technical personnel provide the necessary documentation to support the contract type selection…”

Also: 

“PART 16 - TYPES OF CONTRACTS 

“16.101 General.

(a) A wide selection of contract types is available to the Government and contractors in order to provide needed flexibility in acquiring the large variety and volume of supplies and services required by agencies…

(b) The contract types are grouped into two broad categories: fixed-price contracts (see subpart 16.2) and cost-reimbursement contracts (see subpart 16.3). The specific contract types range from firm-fixed-price, in which the contractor has full responsibility for the performance costs and resulting profit (or loss), to cost-plus-fixed-fee, in which the contractor has minimal responsibility for the performance costs and the negotiated fee (profit) is fixed. In between are the various incentive contracts (see subpart 16.4), in which the contractor's responsibility for the performance costs and the profit or fee incentives offered are tailored to the uncertainties involved in contract performance.”

“Subpart 16.2 - Fixed-Price Contracts

[16.201 General.

…(b) Time-and-materials contracts and labor-hour contracts are not fixed-price contracts.]”  [They are not Cost reimbursement contracts, either. They are separate types.]

“16.5 Indefinite Delivery Contracts

…16.501-2 General.

(a) There are three types of indefinite-delivery contracts: Definite-quantity contracts, requirements contracts, and indefinite-quantity contracts. The appropriate type of indefinite-delivery contract may be used to acquire supplies and/or services when the exact times and/or exact quantities of future deliveries are not known at the time of contract award. Pursuant to 10 U.S.C. 2304d and 41 U.S.C. 4101, requirements contracts and indefinite-quantity contracts are also known as delivery-order contracts or task-order contracts…

..(c) Indefinite-delivery contracts may provide for any appropriate cost or pricing arrangement under part 16. Cost or pricing arrangements that provide for an estimated quantity of supplies or services (e.g., estimated number of labor hours) must comply with the appropriate procedures of this subpart.”

I just realized that you posted this under “Beginners”.  Ok, so it is important to know who is on the acquisition team that is planning the acquisition.

i don’t think that a QA reviewer can dictate either the Pricing “type” or contract vehicle/format/ “type”. I don’t know if you are on the Acquisition Planning team but you are supposed to coordinate the plan with your PCO, per the Part 7 reference above.

This is yet again another FAR semantic problem, isn’t it? So don’t get hung up on the term “contract type” where it falls under both Fixed Price payment type and ID/IQ/MATOC?/SATOC? contract format type.

Don Mansfield said:

Read this:

Then share it with your QA reviewer.

Don, with all due respect, hi don’t think that it is up to a QA reviewer to dictate the contract type or the pricing arrangements for ID/IQ orders. The reviewer could perhaps suggest but not dictate pricing options to the AP team. 

It’s up the the PCO and other members of the acquisition planning team. That would be my first advice to a beginner.

Don:

I started correcting the  code in your blog post.  That is when the software was making up its own code with decorations in 2010.  I see what was done and I think I can fix it.  I'll try to get back to it later.

Boogie_Down said:

I'm confused because shouldn't the provisions and clauses be tailored towards an fixed price contract?

Don's response is spot on.  Two simple thoughts to help.

So what does the QA person believe should be in 52.216-1?

And has the QA person considered 52.216-18 at (b) with regard to your discussion.

C Culham said:

Don's response is spot on.  Two

Yes - but it’s not the QA reviewer’s decision for that either.

joel hoffman said:

Yes - but it’s not the QA reviewer’s decision for that either.

Slow down Joel I was editing while you responded.  Are you sure?   Maybe the agency has regulation or policy that gives the QA person the power.  Maybe even power delegated from the HCA.

Carl, I think that the newbie should first consult with the KO/PCO (required per above reference) and the acquisition team. I really doubt if the (self-declared Beginner)  OP came up with the acquisition strategy on their own.

The OP shouldn’t have to debate a “Quality Assurance reviewer” concerning the acquisition strategy. Get confirmation of the acquisition strategy from the team and the KO.

According to the Acquisition plan coverage in FAR 7.104, the plan explains the reasons for the strategy and approach. For other than firm-fixed-price contract type, the “Acquisition personnel shall document the acquisition plan with findings that detail the particular facts and circumstances, (e.g., complexity of the requirements, uncertain duration of the work, contractor's technical capability and financial responsibility, or adequacy of the contractor's accounting system), and associated reasoning essential to support the contract type selection. “ 

In addition, the contracting agency should have the requisite expertise and personnel to award and manage cost contracts or task orders.

In short, the acquisition plan would have to have a whole lot more discussion if there may be the possibility of cost type task orders, as the reviewer has suggested.

C Culham said:

Maybe the agency has regulation or policy that gives the QA person the power.  Maybe even power delegated from the HCA.

“Maybe” is speculation. The OP didn’t indicate that. What the The OP did say made very good sense though.

joel hoffman said:

“Maybe” is speculation. The OP didn’t indicate that. What the The OP did say made very good sense though.

I apologize I guess you know all the facts.   Carry on.

C Culham said:

I apologize I guess you know all the facts.   Carry on.

Carl, I wasn’t trying to be rude to you. It is exasperating when original posters dribble facts out as a thread proceeds. Im taking the scenario as originally described. If the reviewer has the last word, why would the OP have asked for our opinions? Based upon the information provided, there doesn’t appear to be anything wrong with the acquisition strategy that the OP is articulating. The KO should be the person that the OP confers with here.

Don Mansfield said:

Maybe don't use the term "contract type". Just say the contract will have a firm-fixed price compensation arrangement and an indefinite delivery indefinite quantity delivery arrangement.

Will do.  Thank you.

joel hoffman said:

You need to Discuss this with you PCO/KO.

What gives your “local QA review” the right to dictate what pricing approach or arrangement you must use? i sense that they want you to use an ID/IQ  contract vehicle but not to identify the type of pricing arrangement. Are they in charge of the Acquisition plan? 

The acquisition team, and I presume, including the PCO, want to use an ID/IQ  with FFP orders. The plan should describe both the ID/IQ format and intended pricing arrangement (I.e., Type, see below).

I don’t know the format prescribed for your acquisition plan. However, it would be stupid not to describe the pricing arrangement for an ID/IQ where the acquisition only intends to issue FFP task orders..

Some FAR References

“Part 7 Acquisition Planning

7.104 General procedures.

…(c) The planner shall coordinate with and secure the concurrence of the contracting officer in all acquisition planning…

7.105 Contents of written acquisition plans.

…(b) Plan of action 

…(3) Contract type selection.  Discuss the rationale for the selection of contract type. For other than firm-fixed-price contracts, see 16.103(d) for additional documentation guidance. Acquisition personnel shall document the acquisition plan with findings that detail the particular facts and circumstances, (e.g., complexity of the requirements, uncertain duration of the work, contractor's technical capability and financial responsibility, or adequacy of the contractor's accounting system), and associated reasoning essential to support the contract type selection. The contracting officer shall ensure that requirements and technical personnel provide the necessary documentation to support the contract type selection…”

Also: 

“PART 16 - TYPES OF CONTRACTS 

“16.101 General.

(a) A wide selection of contract types is available to the Government and contractors in order to provide needed flexibility in acquiring the large variety and volume of supplies and services required by agencies…

(b) The contract types are grouped into two broad categories: fixed-price contracts (see subpart 16.2) and cost-reimbursement contracts (see subpart 16.3). The specific contract types range from firm-fixed-price, in which the contractor has full responsibility for the performance costs and resulting profit (or loss), to cost-plus-fixed-fee, in which the contractor has minimal responsibility for the performance costs and the negotiated fee (profit) is fixed. In between are the various incentive contracts (see subpart 16.4), in which the contractor's responsibility for the performance costs and the profit or fee incentives offered are tailored to the uncertainties involved in contract performance.”

“Subpart 16.2 - Fixed-Price Contracts

[16.201 General.

…(b) Time-and-materials contracts and labor-hour contracts are not fixed-price contracts.]”  [They are not Cost reimbursement contracts, either. They are separate types.]

“16.5 Indefinite Delivery Contracts

…16.501-2 General.

(a) There are three types of indefinite-delivery contracts: Definite-quantity contracts, requirements contracts, and indefinite-quantity contracts. The appropriate type of indefinite-delivery contract may be used to acquire supplies and/or services when the exact times and/or exact quantities of future deliveries are not known at the time of contract award. Pursuant to 10 U.S.C. 2304d and 41 U.S.C. 4101, requirements contracts and indefinite-quantity contracts are also known as delivery-order contracts or task-order contracts…

..(c) Indefinite-delivery contracts may provide for any appropriate cost or pricing arrangement under part 16. Cost or pricing arrangements that provide for an estimated quantity of supplies or services (e.g., estimated number of labor hours) must comply with the appropriate procedures of this subpart.”

Thank you for the references.  The QA team isn't in charge of the AP, but their signature on the review is mandatory before I send it up higher for further approval.

joel hoffman said:

I just realized that you posted this under “Beginners”.  Ok, so it is important to know who is on the acquisition team that is planning the acquisition.

i don’t think that a QA reviewer can dictate either the Pricing “type” or contract vehicle/format/ “type”. I don’t know if you are on the Acquisition Planning team but you are supposed to coordinate the plan with your PCO, per the Part 7 reference above.

This is yet again another FAR semantic problem, isn’t it? So don’t get hung up on the term “contract type” where it falls under both Fixed Price payment type and ID/IQ/MATOC?/SATOC? contract format type.

I am part of the team along with the BC and COR.  The QA reviewer is a mandatory approval step and is forcing me to make edits that I don't think are correct.  I'm looping the team in on it and we are going to have a discussion with them.

I am not going to use the term "contract type" as Don said.  I will discuss the delivery and compensation methods and further tell them how important it is to flesh the compensation method out within the AP.

C Culham said:

Don's response is spot on.  Two simple thoughts to help.

So what does the QA person believe should be in 52.216-1?

And has the QA person considered 52.216-18 at (b) with regard to your discussion.

They haven't addressed this yet.  They have ignored most of my comments.  We are scheduling a meeting and will discuss this in detail.

C Culham said:

Slow down Joel I was editing while you responded.  Are you sure?   Maybe the agency has regulation or policy that gives the QA person the power.  Maybe even power delegated from the HCA.

After I complete the final draft of the AP it goes through several approval reviews that require a signature on the document before moving to the next reviewer.  My AP was reviewed by the BC, DC and is not stuck at the QA review on this issue.  I need to have it resolved before I can move it forward.

joel hoffman said:

Carl, I wasn’t trying to be rude to you. It is exasperating when original posters dribble facts out as a thread proceeds. Im taking the scenario as originally described. If the reviewer has the last word, why would the OP have asked for our opinions? Based upon the information provided, there doesn’t appear to be anything wrong with the acquisition strategy that the OP is articulating. The KO should be the person that the OP confers with here.

My CO supports me and my decision but everyone seems to accept what QA says without question here.  So this is the first time it appears where the QA reviewer is asking contracting to make a change that isn't correct and will cause further issues with the acquisition and I haven't gone along with their decision.  I think there's some agency confusion about who controls what when it comes to reviews.  Our legal team does the same and they take a hard lined stance on issues that are debatable and will not give legal approval unless contracting does everything that they say.  It's a weird group dilemma.  QA is supposed to be a support and resource outlet but will not let formal reviews go through unless they agree with every issue.  Most of my team will just make the changes without question and go on.  Many are burned out and don't want to go through the trouble of pushing back or questioning decisions.  I normally go along with everything as well except this seems like an issue that can cause me a lot of headache down the road with the solicitation.

Seems to me the QA reviewer doesn't want to change the contract type, they just want to change the way it's described in the AP. I don't see why this should have any effect on provision or clause selection.

@Boogie_Down, ask the QA reviewer if he/she is just making it vague enough in writing in the AP so that you don’t have to go back and get it reapproved if you eventually change course. That’s a paperwork nightmare and a common problem you’ll want to avoid. Oh and it’s a sign of a bureaucracy too, but I digress (you and I both work in one).

Because of the Planning Fallacy, there's always the chance you could add a T&M CLIN or something, and you wouldn’t want to be inhibited from doing that by the additional action of needing to revise - and get COCO/HCA to sign - the AP.

Then again, if this is entirely Firm-Fixed Price, your CO’s boss could approve, depending on your agency supplement’s implementation of FAR 7.103(j):

https://www.ecfr.gov/current/title-48/chapter-1/subchapter-B/part-7/subpart-7.1#p-7.103(j)

Boogie what is the BC? Sorry for not knowing. DC = Director of Contracting, right?

I agree with Don’s suggestion, although the QA reviewer may still object to the FFP aspect.   

I’m curious, who will be the intended user/customer for the ID/IQ? It it pretty clear that all orders would be FFP?  I.E., is there a possibility of orders that would include time and materials or labor hour services?  If no, I’d suggest explaining that in your ACQ Plan. 

Boogie_Down said:

Will do.  Thank you.

It is a pitiful and sorry state of affairs in a contracting office when a contracting officer MUST make a change to satisfy a staff reviewer, in order for the package to continue its progress.  Ideally, and professionally, when a contracting officer disagrees with a staff reviewer's comment, the file should go forward for the approver to make the call.

Boogie, if you believe you are right, why don't you approach the approver and ask for his or her decision on the matter?

ji20874 said:

It is a pitiful

The guiding principles of the FAR gone array especially with regard to the ideal of acquisition "team".

Not sure of the OPs agency but I found this in DFARS that supports in my view that contract type and pricing are separate identifiers.  I sure would like to get my hands on the OPs policy or whatever regarding AP review/approval.

For indefinite delivery indefinite quantity (IDIQ) contracts that will establish pricing terms that apply to orders, use the total maximum dollar value for purposes of the peer review threshold. IDIQ contracts that will not establish pricing terms in the basic contract are not subject to peer review, but individual orders that exceed the threshold are subject to peer review.

We aren’t giving the OP very good advice here.  It’s the Beginner's section.  For starters, most reviewers have that job because their management respects their knowledge and experience.  They are expected to ensure a document submitted for approval meets management expectations.  In short, they know what gets through and what doesn’t.  This shouldn’t be a battle between the OP and the reviewer.  I’m pretty sure the reviewer is just doing their job which most likely is what the management expects and wants.

An IDIQ type contract doesn’t neatly fall into one of the two categories as Don and Carl stated.  Rather they lead to orders priced a certain way.  Most offices within the government would label what the OP describes as an IDIQ contract with firm fixed price task orders issued.

As far as what clauses the contract writing system produces, the OP shouldn’t just rely on calling it a fixed price contract.  An IDIQ contract has clauses applicable to it as well.  Those need added too.

formerfed said:

This shouldn’t be a battle between the OP and the reviewer.

No one is talking about a battle.  There should always be room for professional dialogue, and a reviewer should never hold a file hostage.  I do not share your confidence that reviewers, as a rule, are experts.  I also believe any approving official should be willing to engage and give guidance.

formerfed said:

Most offices within the government would label what the OP describes as an IDIQ contract with firm fixed price task orders issued.

Perhaps “a [multiple][single] award (as applicable) IDIQ” with firm fixed-price task orders. 🙂

On 9/1/2022 at 3:57 PM, joel hoffman said:

Boogie what is the BC? Sorry for not knowing. DC = Director of Contracting, right?

Sorry, BC is Branch Chief.

On 9/1/2022 at 2:28 PM, Voyager said:

Then again, if this is entirely Firm-Fixed Price, your CO’s boss could approve, depending on your agency supplement’s implementation of FAR 7.103(j):

https://www.ecfr.gov/current/title-48/chapter-1/subchapter-B/part-7/subpart-7.1#p-7.103(j)

Thanks.  My agency has added more levels of approval.

On 9/1/2022 at 4:10 PM, joel hoffman said:

I agree with Don’s suggestion, although the QA reviewer may still object to the FFP aspect.   

I’m curious, who will be the intended user/customer for the ID/IQ? It it pretty clear that all orders would be FFP?  I.E., is there a possibility of orders that would include time and materials or labor hour services?  If no, I’d suggest explaining that in your ACQ Plan.

It is definitely a FFP, no chance of any other types.

On 9/1/2022 at 7:26 PM, ji20874 said:

It is a pitiful and sorry state of affairs in a contracting office when a contracting officer MUST make a change to satisfy a staff reviewer, in order for the package to continue its progress.  Ideally, and professionally, when a contracting officer disagrees with a staff reviewer's comment, the file should go forward for the approver to make the call.

Boogie, if you believe you are right, why don't you approach the approver and ask for his or her decision on the matter?

I did.  My Branch Chief and Division Chief had already approved and signed.  The QA reviewer is next before it goes to the HCA.  HCA will not look at it without all signatures and approvals of other members.

On 8/31/2022 at 11:58 AM, Boogie_Down said:

My question is, am I interpreting the contract type correctly?  Is stating a firm fixed price IDIQ contract correct?  Or is the QA reviewer correct in that it's only an IDIQ with no mention of fixed price?

I think the QA reviewer is being bone headed. But, that said, it's an entry in an acquisition plan. In my experience, the main purpose of an AP is to get approval to initiate the contract formation process. 

Besides, since FFP is the preferred pricing arrangement, and since the contract will be FFP, the fact that the contract will be IDIQ may be more significant.

Most of the people who have responded to your OP seems to sympathize with you, but it appears that the QA has more go power than you.

My advice is to just do what you gotta do to get the plan signed and then get on with the process.

On 8/31/2022 at 11:58 AM, Boogie_Down said:

My question is, am I interpreting the contract type correctly?  Is stating a firm fixed price IDIQ contract correct?  Or is the QA reviewer correct in that it's only an IDIQ with no mention of fixed price?

I think the QA reviewer is being bone headed. But, that said, it's an entry in an acquisition plan. In my experience, the main purpose of an AP is to get approval to initiate the contract formation process. This is not an issue I would bother about.

Besides, since FFP is the preferred pricing arrangement, and since the contract will be FFP, the fact that the contract will be IDIQ may be more significant.

Most of the people who have responded to your opening post seem to agree with you, but it appears that the QA has more bureaucratic go-power than you.

So my advice is to put this behind you and just do what you gotta do to get the plan signed so you can get on with the process.

On 9/2/2022 at 2:15 PM, joel hoffman said:

Perhaps “a [multiple][single] award (as applicable) IDIQ” with firm fixed-price task orders."

One additional piece of information related to contract type that might be necessary to explain to approvers/reviewers is whether firm-fixed task orders will be based on unit prices established in the base contract or will be competitively established under fair opportunity (multiple award) or negotiated (single award). That piece of information has a significant impact on the actual future operation of the contract.

So maybe “a [multiple][single] award IDIQ with firm fixed-price task orders [issued under fair opportunity/issued based on fixed unit prices/negotiated at the task order level]."

Witty_Username said:

will be competitively established under fair opportunity

I take exception to this.   Fair Opportunity is an order placement process not a competition.

Vern Edwards said:

I think the QA reviewer is being bone headed. But, that said, it's an entry in an acquisition plan. In my experience, the main purpose of an AP is to get approval to initiate the contract formation process. 

Besides, since FFP is the preferred pricing arrangement, and since the contract will be FFP, the fact that the contract will be IDIQ may be more significant.

Most of the people who have responded to your OP seems to sympathize with you, but it appears that the QA has more go power than you.

My advice is to just do what you gotta do to get the plan signed and then get on with the process.

Thanks.  I did just that.  On to the next thing.

👍

C Culham said:

Fair Opportunity is an order placement process not a competition.

I was specifically referring to how the price would be established for the order as something an acquisition plan reviewer might be interested in knowing. Since 16.505(b)(3) (I believe, that is a difficult citation to figure out) says If the contract did not establish the price for the supply or service, the contracting officer must establish prices for each order using the policies and methods in subpart 15.4 I thought it was reasonable to summarize the 15.404-1(b)(2(i) method of Comparison of proposed prices received in response to the solicitation as "competition."  

But now I do see that 16.505(b)(1)(iii)(A) actually says Each order exceeding the simplified acquisition threshold shall be placed on a competitive basis so it seems like it would be ok to refer to the fair opportunity process as a competition.

Witty_Username said:

the contracting officer must establish prices for each order using the policies and methods in subpart 15.4

Pricing policy not an order placement guiding principle from my view.   

Buried in FAR 16 regarding fair opportunity ordering....

 The contracting officer may exercise broad discretion in developing appropriate order placement procedures. The contracting officer should keep submission requirements to a minimum. Contracting officers may use streamlined procedures, including oral presentations. If the order does not exceed the simplified acquisition threshold, the contracting officer need not contact each of the multiple awardees under the contract before selecting an order awardee if the contracting officer has information available to ensure that each awardee is provided a fair opportunity to be considered for each order. The competition requirements in part 6 and the policies in subpart 15.3 do not apply to the ordering process.

 I just think in terms of the FAR.  I realize a general definition makes sense. To me it is not competing orders it is giving folks a fair opportunity for consideration for award of the order.

Carl said this above: ”To me it is not competing orders it is giving folks a fair opportunity for consideration for award of the order.”

Actually, see this under 16.505 (b)(1) (iii):

“(iii) Orders exceeding the simplified acquisition threshold.

(A) Each order exceeding the simplified acquisition threshold shall be placed on a competitive basis in accordance with paragraph (b)(1)(iii)(B) ** of this section, unless supported by a written determination that one of the circumstances described at 16.505(b)(2)(i) applies to the order and the requirement is waived on the basis of a justification that is prepared in accordance with 16.505(b)(2)(ii)(B);

(** Fair Opportunity)

joel hoffman said:

(** Fair Opportunity)

So maybe Witty's statement should have been. 

 "One additional piece of information related to contract type that might be necessary to explain to approvers/reviewers is whether firm-fixed task orders will be based on unit prices established in the base contract or will be competitively established under fair opportunity (multiple award) or negotiated (single award). That piece of information has a significant impact on the actual future operation of the contract."

On 9/8/2022 at 5:52 AM, C Culham said:

I take exception to this.   Fair Opportunity is an order placement process not a competition.

C Culham said:

Buried in FAR 16 regarding fair opportunity ordering....

 The contracting officer may exercise broad discretion in developing appropriate order placement procedures. The contracting officer should keep submission requirements to a minimum. Contracting officers may use streamlined procedures, including oral presentations. If the order does not exceed the simplified acquisition threshold, the contracting officer need not contact each of the multiple awardees under the contract before selecting an order awardee if the contracting officer has information available to ensure that each awardee is provided a fair opportunity to be considered for each order. The competition requirements in part 6 and the policies in subpart 15.3 do not apply to the ordering process.

 I just think in terms of the FAR.  I realize a general definition makes sense. To me it is not competing orders it is giving folks a fair opportunity for consideration for award of the order.

The GAO considers the "fair opportunity" process to be a kind of competition, but not a CICA competition. See Adams Communication & Engineering Technology, Inc., GAO B-419052, Dec. 3, 2020:

Quote

When conducting a competition under FAR 16.505, agencies are required to provide contract holders with a “fair opportunity” to be considered for task or delivery orders. FAR 16.505(b)(1). While FAR 16.505 does not establish specific requirements regarding the conduct of discussions under a task or delivery order competition, exchanges occurring with contract holders of multiple award contracts in a FAR 16.505 procurement, like other aspects of such a procurement, must be fair.

The GAO has said the same in several other decisions., e.g., IBM Corp., GAO B-417664, Sept. 18, 2019:

Quote

Task order competitions are subject to the provisions of section 16.505 of the Federal Acquisition Regulation (FAR), which requires agencies to provide awardees of a multiple-award contract a fair opportunity to be considered for each order, but specifically states that “the policies in [FAR] Subpart 15.3 do not apply to the ordering process.” FAR § 16.505(b)(1)(ii). Section 16.505 of the FAR requires agencies to develop placement procedures that will provide each awardee a fair opportunity to be considered for each order, and to include such procedures in the solicitation and the contract.

But I understand where Carl is coming from. I think "to be considered" does not sound like the kinds of active competitions we think of when we read elsewhere in FAR. See, for instance, FAR 16.505(b)(1)(ii):

Quote

The contracting officer may exercise broad discretion in developing appropriate order placement procedures. The contracting officer should keep submission requirements to a minimum. Contracting officers may use streamlined procedures, including oral presentations. If the order does not exceed the simplified acquisition threshold, the contracting officer need not contact each of the multiple awardees under the contract before selecting an order awardee if the contracting officer has information available to ensure that each awardee is provided a fair opportunity to be considered for each order. The competition requirements in part 6 and the policies in subpart 15.3 do not apply to the ordering process.

Inconsistent terminology is the bane of our business.

I only have my iPhone today so can’t look up if and when the MATOC fair opportunity process was added to the 16.5, Ordering.

However, when I transferred to Steve Feldman’s Corps of Engineers Division in 1997, an often used practice there was akin to “share the wealth” and spreading the task orders between pool members. My previous organization, Mobile District, also often used that method.

The order process now requires (except for the exceptions) competition, using “fair opportunity” procedures.