AFARS PART 5117

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Subpart 5117.1 -- Multiyear Contracting

Subpart 5117.2 -- Options


AFARS -- Part 5117

Special Contracting Methods


Subpart 5117.1 -- Multiyear Contracting

5117.171 Multiyear contracts for services

Subpart 5117.2 -- Options

5117.204 -- Contracts.

(e) PARCs may approve use of options that extend contracts beyond the five-year regulatory limit.

5117.290 -- Addition of Option Clause or Quantities to Contracts After Award.

Modification of contracts to incorporate option clauses or additional option quantities after award is a noncompetitive action and cannot be done without prior approval in accordance with FAR 6.304. Such requests must be documented to give the reason for the proposed modification and the potential impact of disapproval.

Subpart 5117.90 -- Job Order Contracts

5117.9000 -- Scope of Subpart.

(a) Job Order Contracting (JOC) is an alternative contracting method to fulfill requirements for real property maintenance and repair and minor construction projects at installation level (post, camp or station), with an estimated value exceeding $2000, but not exceeding the amount of RPMA authority delegated to the installation by the MACOM and/or HQDA. In general, proposed projects valued at $2,000 or less are considered inappropriate for ordering under JOC because of the administrative costs associated with processing JOC orders and the simplified purchase methods available for these actions.

5117.9001 -- Definitions.

As used in this subpart --

“Coefficient” means a numerical factor that represents costs (generally indirect costs) not considered to be included in “Unit Price Book” unit prices (e.g., general and administrative and other overhead costs, insurance costs, bonding and alternative payment protection costs, protective clothing, equipment rental, and also contractor’s profit). Contingencies such as changes in wage rates and the effect of inflation in option years, are also covered in the coefficient when Economic Price Adjustment is not used. Coefficients proposed by offerors are multiplied times the unit prices in the Unit Price Book to price a job or project on individual orders. The coefficient(s) proposed by the offeror and accepted by the Government are incorporated in the JOC.

“Job order contract” means an indefinite-delivery, indefinite-quantity contract which is awarded on the basis of full and open competition and effective competition and is used to acquire real property maintenance and repair or minor construction at installation (post, camp, or station) level. The JOC includes a comprehensive collection of detailed repair, maintenance and minor construction task descriptions or specifications, units of measure and pre-established unit prices for each of these discrete tasks. Each project or job ordered under a JOC is normally comprised of a number of pre-described and pre-priced tasks.

“Non-prepriced task or item” means a necessary, but incidental, part of a job or project ordered or to be ordered under a JOC that is not susceptible to unit pricing using the pre-priced tasks in the Unit Price Book or database incorporated in the JOC. The coefficient developed for a prepriced task or item must not be applied to a non-pre-priced task or item.

“Unit Price Book” means the compilation of real property repair, maintenance, and minor construction tasks, associated units of measure and unit prices that is used in job order solicitations and JOC. JOC unit prices include direct material, labor and equipment costs, but not indirect costs or profit which are addressed in the coefficient(s). Depending upon the source of the data base used, the UPD may contain from 25,000-90,000 line items.

5117.9002 -- Applicability.

(a) JOC may be used to acquire real property maintenance and repair or minor construction at an installation.

(b) JOC must only be used for the projects covered at 5117.9000. Installation facilities engineering support services, such as utility plant operation, custodial, grounds maintenance, refuse collection and disposal, and similar work cannot be acquired using JOC. Architect-engineer services as defined in FAR 36.102 cannot be acquired under JOC. However, informal (shop) drawings, incidental to the job, reflecting the plan of action and the completed project, are anticipated under JOC.

5117.9003 -- Use of Job Order Contracts.

5117.9003-1 -- Characteristics.

In general, a JOC involves the following unique characteristics:

(a) Use of a “Unit Price Book” to pre-price the direct material, labor, and equipment costs associated with tasks listed in the book coupled with one or more “coefficient(s)” to cover contractor profit and indirect costs.

5117.9003-3 -- Planning and Coordination.

(a) JOC should be considered when an installation’s projected real property repair, maintenance and minor construction workload is anticipated to be of such a yearly volume that the benefits to be derived from JOC use are greater than the costs of the Government resources and contractor overhead associated with establishing and using a JOC. These costs include the total Government resources required to award, use, monitor and administer the JOC and JOC orders as well as management oversight and functional support of the total JOC process. The calculated workload for a potential JOC should exclude --

(b) A market survey must establish that more than one capable firm is willing to compete for a JOC at the installation.

5117.9004 -- Procedures.

5117.9004-1 -- Presolicitation.

(a) The DPW must document the decision and plan to use a JOC in support of an installation or activity. The installation commander, who cannot re-delegate this authority, must approve the decision and plan. The decision to use JOC must also be documented and approved when the JOC is re-solicited.

5117.9004-2 -- Solicitation.

(a) The contracting officer, in coordination with the installation DPW, must assure that the specifications and Unit Price Book have undergone technical review and validation and are tailored to meet the projected requirements of the installation and local economic conditions. This is a critical step in implementing JOC and is required to minimize the need for non-pre-priced items during the processing of task orders. The projects proposed to be ordered under JOC must be identified in internal documentation, and a representative description must be included in the solicitation.

(b) To encourage competition and lower coefficients, the JOC solicitation must include realistic and reasonable annual minimum and maximum dollar amounts for projected requirements. Generally, the higher the minimum is, the lower the coefficient proposed will be. The annual maximum is connected with the bonding requirement (see the definition at 5117.9001).

(g) JOC solicitations and contracts must clearly notify offerors of initial and continuing bonding requirements. The term “bonding” used in this paragraph includes any relevant alternative payment protection as discussed in FAR 28.102-1. Bonding must be sufficient to cover the stated estimated annual maximum contract value. No JOC contract shall cite the total estimated maximum value of the contract (including option periods) as the estimated annual maximum value, although there may be language in the contract allowing ordering beyond that “maximum” but less than the estimated value of the total contract with option periods. The estimated annual maximum value will be a reasonable figure based on historical experience and known workload for the coming year. This approach should avoid the prior difficulties associated with adjusting bonding coverage every time a new task order is awarded. Because contractors can now plan their liability for premiums, and because they get unliquidated/unneeded premiums reimbursed by the bonding agent, payment incrementally through the use of the coefficient becomes both logical and reasonable. Contractors must be clearly notified, in the solicitation and contract, of their responsibility for ensuring sufficient bond coverage during the course of the contract. All costs associated with bonding (specifically including bond premiums) shall be included in the coefficient. If the estimated annual maximum value is exceeded, FAR 28.102-2(a) and (b) apply. Since the bond premium is repaid through the coefficient and the coefficient is paid as an indirect cost under progress payment or other normal payment provisions there will be no separate repayment(s) for bond premiums.

(i) Job order solicitations must be accorded the same type of planning and management review as commercial activities procurement actions.

5117.9004-3 -- Ordering.

(a) Summary of ordering process. After the requirement is validated in accordance with command or installation procedures and an estimate is prepared to determine suitability of the project for the JOC, the SOW is presented to the contractor with a request for a proposal. The contractor then prepares a proposal that identifies the tasks and quantities necessary to accomplish the job. This proposal is subsequently evaluated, and agreement is reached on quantities, time, performance period, etc., through discussions and negotiations. After agreement, a fixed-price bilateral order is prepared. (Some integral non-pre-priced work may be included in the order. (See (e)(2).)

(c) Independent Government estimate.

(d) Negotiations.

(e) Limitations.

(f) Funding. Funds for the guaranteed minimum amount must be obligated on the awarded JOC. Contract performance and cumulative orders under the guaranteed minimum amount are not limited to the fiscal year in which the contract becomes effective. Funds beyond the guaranteed minimum required to complete a proposed project must be obligated by each task order. Orders beyond the guaranteed minimum must also comply with the bona fide need principles in AR 37-1, statutory and other restrictions on year-end spending.

(h) Distribution. A copy of all JOC orders must be sent to the contracting office appointing ordering officers, the Finance and Accounting Office, the office or individual assigned responsibility for inspection and technical administration of the contract, and any appointed COR. The contracting officer must maintain the permanent record of each transaction.

5117.9005 -- Contract Administration.

Contractor performance evaluations must be prepared for all orders of $100,000 or more and submitted to the CCASS in accordance with 5136.201.

5117.9006 -- JOC Ordering Officers.

(a) Appointment.

(b) Training. All JOC ordering officers must receive specific training and orientation from the responsible contracting office. This training must cover policy and procedures for operation of JOC, including this AFARS coverage, and shall specifically address the ordering officer’s authority, limitations and responsibilities, to include ethics, conflict of interest, and potential pecuniary liabilities.

(c) Authorization and limitations.

(d) Responsibilities. JOC ordering officers --

5117.9007 -- Contracting Officer Responsibilities.

(a) The contracting officer is the official ultimately responsible for management of all aspects of JOC, including the actions of any JOC ordering officer, COR, and member of the DPW staff who is carrying out functional oversight responsibilities related to JOC administration.

(d) The JOC contracting officer must ensure that all orders and modifications to orders, together with significant supporting documentation issued outside the contracting office, are duly received, recorded, and reported and that such orders are regularly reviewed for completeness and compliance with AFARS and sound business practices. At least twice a year, the contracting officer must ensure that ordering officer files and procedures are reviewed and that a representative sampling of orders is selected for tracking from initiation of the requirement to final payment and close-out of the order.

5117.9008 -- Internal Controls.

(a) The internal control program must include the following:

(b) An internal control JOC action and documentation checklist, tailored to the needs of the command or installation shall be developed to assist personnel responsible for management of JOC. Activities may use those measures outlined in the Internal Control and Review Plan, Appendix D of the JOC Guide to supplement existing internal control plans.

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