Commercial Item | The Contracting Education Academy

October 29, 2018 By AMK

Federal Circuit charts new terrain in ‘commercial item’ contracting

Last month, the Federal Circuit weighed in on a largely-overlooked provision in the Federal Acquisition Streamlining Act (FASA) that requires federal agencies, to the maximum extent practicable, to procure commercially available goods and services to meet their needs.

In the case — Palantir USG v. United States — the court affirmed the decision by the Court of Federal Claims (COFC) enjoining the Army from proceeding with its Distributed Common Ground System – Army Increment 2 (DCGS-A2) procurement until it complies with the FASA provision.

This bid protest decision has potentially significant implications for commercial item contractors.

DCGS-A2 is not your average solicitation for an IT system. It is phase two of the Army’s flagship system for processing multi-sensor intelligence — a program that the Army has spent nearly two decades and billions of dollars trying to develop. For several years prior to the release of the DCGS-A2 solicitation, Palantir — the protester — informed the Army that the company already had a commercial item that Palantir believed fit the Army’s requirements. Despite Palantir’s communications regarding the capabilities of its product, the Army issued a single-source indefinite-delivery/indefinite-quantity solicitation focused on developing a new intelligence data management system — essentially from scratch. Palantir protested the solicitation and argued that it violated FASA’s mandate regarding the use of commercial items.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2018/10/federal-circuit-charts-new-terrain-commercial-item-contracting/

October 18, 2018 By AMK

Efforts to speed procurement of commercial off-the-shelf items influenced by ‘The Amazon Effect’

Amazon looms large over the world’s commerce, drawing a stark contrast to old ways of shopping, and an even starker contrast to the way government agencies buy things. In fact, there’s even a term for it: The Amazon Effect.

So, when Section 846 of 2018 National Defense Authorization Act was enacted, providing for the Pentagon and other federal government agencies to buy directly from e-marketplaces, it was immediately dubbed the “Amazon Bill,” and not just because of the Amazon Effect.

Introduced by Congressman Mac Thornberry, the bill was crafted to help speed the procurement process for commercial off-the-shelf (COTS) products through e-commerce portals. The General Services Administration (GSA), in partnership with the Office of Management and Budget (OMB), is currently working on the strategy and plan to properly implement and execute this legislation.

Based on input from the providers of commercial e-commerce portals and e-procurement solutions, the GSA and OMB team has developed the initial plan (Phase I) and is now working on the market research and industry consultation needed to develop the program’s implementation guidance (Phase II). This is not a simple task, as the team must review and consider existing processes and all the requirements of public procurement — buying off negotiated contracts from vetted suppliers who have invested heavily in meeting government requirements, and giving fair treatment to small, disadvantaged, minority women-owned and veteran-owned companies. The target is to have things completed by 2020.

However, the gap between expectations of selection, ease of use and speed that Amazon has created among consumers, and the reality of what is actually possible in the federal government continues to crop up as we move into the next phase of this process, the proof of concept phase.

Keep reading this article at: https://www.publicspendforum.net/blogs/andrew-malay/2018/10/09/future-federal-government-procurement-ecommerce

September 24, 2018 By AMK

Federal circuit court confirms agencies’ obligations to prioritize commercial solutions

Palantir USG v. United States may prove to be one of the most significant procurement precedents of the decade.

Affirming the Court of Federal Claims, the Federal Circuit breathed new life into the government’s obligations under the Federal Acquisition Streamlining Act (FASA) to prioritize, to the maximum extent practicable, the acquisition of commercial and nondevelopmental solutions.

Weaning agencies off their historic preference for developmental solutions is critical now more than ever, as it is readily apparent that maintaining the United States’ technological and battlefield superiority depends on its ability to harness technologies from the commercial sector and become a more commercial-friendly business partner.

The decision will have the practical impact of requiring agencies to more carefully document their market research. Palantir will also provide useful leverage for companies seeking to eliminate (whether by negotiation or protest) solicitation provisions that are not accommodating to commercial vendors.

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=737610

September 5, 2018 By AMK

GSA to close down reverse auction platform after 5 years

Look back over the last say 25 years and see if you can remember the last time an agency publicly admitted defeat with a program or project and decided to move on.

Don’t think about a contract that failed or even an act of Congress ending a specific program, but focus on a service offering that just couldn’t make it.

It’s hard to find one. Right?

This is why the General Services Administration’s decision to shut down its reverse auction tool on Dec. 31 is significant.

GSA is pulling the plug after just over five years.

Keep reading this article at: https://federalnewsradio.com/reporters-notebook-jason-miller/2018/08/gsa-to-close-down-reverse-auction-platform-after-5-years/

August 21, 2018 By AMK

CAS Board clarifies commercial item exemption, but raises potential audit issue

After publishing a proposed rule more than five and a half years ago, the Cost Accounting Standards (CAS) Board on July 17, 2018 issued a final rule revising the CAS exemption for contracts or subcontracts for the acquisition of commercial items.

The final rule clarifies that the current CAS exemption for commercial items extends to all contract types listed in Federal Acquisition Regulation (FAR) 12.207. However, in doing so, it also creates a potential audit issue arising out of the conditions levied by FAR 12.207 on certain contract types.

FAR lists contract types the government may use to acquire commercial items, including firm-fixed-price (FFP) contracts in conjunction with award fee incentives or performance/delivery incentives, known as fixed-price incentive (FPI) contracts. The relevant CAS commercial item exemption states that certain types of contracts for the acquisition of commercial items are exempt from all CAS. CAS 9903.201-1(b)(6) lists various contract types, including FFP, fixed-priced with economic price adjustment, time-and-materials (T&M) and labor-hour (LH), but makes no mention of FPI contracts. This inconsistency is the result of various amendments over time by the FAR Council to FAR 12.207. The final rule amends the language in CAS 9903.201-1(b)(6) to exempt commercial item contracts and subcontracts authorized in FAR 12.207 from all CAS requirements. Look for this change to CAS 9903.201-1(b)(6) when the final rule becomes effective on August 16, 2018.

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=726522

Last month, the Federal Circuit weighed in on a largely-overlooked provision in the Federal Acquisition Streamlining Act (FASA) that requires federal agencies, to the maximum extent practicable, to procure commercially available goods and services to meet their needs.

Amazon looms large over the world’s commerce, drawing a stark contrast to old ways of shopping, and an even starker contrast to the way government agencies buy things. In fact, there’s even a term for it: The Amazon Effect.

Palantir USG v. United States may prove to be one of the most significant procurement precedents of the decade.

Look back over the last say 25 years and see if you can remember the last time an agency publicly admitted defeat with a program or project and decided to move on.

After publishing a proposed rule more than five and a half years ago, the Cost Accounting Standards (CAS) Board on July 17, 2018 issued a final rule revising the CAS exemption for contracts or subcontracts for the acquisition of commercial items.

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