AFARS -- Part 15
Contracting by Negotiation
AAC 96-3
June 23, 1999
This AFARS Part 15 contains only minimum essential Army policies and procedures. It does not attempt to restate the polices contained in the FAR and DFARS or to duplicate the many excellent public documents that provide more detailed procedures and "how-to" information. The public documents are generally accessible through the Internet and the Defense Acquisition Deskbook. In particular, the Army Materiel Command's AMC Pamphlet 715-3, "Contracting for Best Value: A Best Practices Guide to Source Selection" is highly recommended.
Formal source selection as used in this part means those source selections for high dollar value or complex acquisitions where someone other than the procuring contracting officer is appointed as the source selection authority (SSA).
Subpart 15.1
Source Selection Processes and Techniques
15.101 -- Best Value Continuum.
(a) Use the tradeoff process for all formal source selections, unless the SSA makes a specific, documented decision not to do so. Consider the use of the tradeoff process for all other complex or high dollar value acquisitions whenever appropriate. Conduct source selections for architect-engineering services in accordance with FAR Part 36.
(b)
(1) Evaluate and consider Manpower and Personnel Integration (MANPRINT) requirements and opportunities included as evaluation factors and significant subfactors in the best value tradeoff analyses associated with source selection for acquisition of all Army systems. See AFARS 15.304(S-90).
Subpart 15.2
Solicitation and Receipt of Proposals and Information
15.201 -- Exchanges With Industry Before Receipt of Proposals
(c)(6)
(i) Use Draft RFPs (DRFPs) as a normal part of the acquisition strategy for complex and high dollar value acquisitions. Use DRFPs for other acquisitions when there are concerns with the statement of work or specifications or when there are significant technical risks. When a written acquisition plan is required (DFARS 207.103(c)) and a DRFP is not used, include rationale for not using a DRFP in the plan.
(ii) Encourage prospective contractors to --
(A) Evaluate and challenge all elements of the DRFP;
(B) Propose methods to reduce proposal and contract costs;
(C) Provide feedback on the proposed pricing arrangement; and
(D) Identify requirements that account for a high percentage of total cost.
(iii) Emphasize that responses are voluntary, not mandatory, that the Government is not soliciting offers, and that the contracting officer shall determine which suggested changes are accepted.
15.203 -- Requests for Proposals.
(a)(3)
(S-90) Solicitations shall require offerors to respond to all pertinent MANPRINT considerations in the SOW, statement of objectives or other description.
(e) HCAs are authorized to exempt individual contracts from the use of a uniform contract format, and may delegate this authority no lower than to the PARC. The Deputy Assistant Secretary of the Army (Procurement) is authorized to exempt classes of contracts. Do not grant any exemptions without coordinating with affected contract administration and payment offices.
15.204-2 -- Part I -- The Schedule
(c) Section C, Description/specifications/statement of work. The SOW, statement of objectives or other description shall reflect all pertinent MANPRINT considerations from the Operational Requirements Document (ORD) and Mission Needs Statement (MNS). Also include any enhanced considerations resulting from market research and contributions from Integrated Product Teams. Include in the SOW or other description as specific, stand-alone functional requirements important MANPRINT issues or opportunities identified in paragraph 4 or 5 of the ORD.
15.207 -- Handling Proposals and Information
(b) The contracting officer or designee, or a senior procurement official from the buying organization shall be present at any briefing or presentation where proprietary or source selection information will be disclosed. See 3.104-5.
(a)
(1) The Army Acquisition Executive (AAE) or designee is the SSA for Major Defense Acquisition Programs, Major Automated Information System acquisition programs, and designated Army acquisition programs.
(2) HCAs are delegated authority to appoint the source selection authority for --
(i) Acquisition Category II, III and IV programs defined in DoDI 5000.2, Part 2.; and
(ii) Acquisitions not managed in accordance with DoDD 5000.1 for which formal source selection procedures are used.
(3) HCAs shall coordinate SSA appointments for ACAT II, III and IV programs with the Milestone Decision Authority and, if applicable, the Program Executive Officer. HCAs shall not redelegate the authority to appoint the SSA for an ACAT II program.
(4) The Deputy Assistant Secretary of the Army (Procurement) may appoint the SSA for any acquisition described in (a)(2).
(5) HCAs for HQ, AMC subordinate activities shall send SSA nominations which require AAE approval to the addressee in 1.290(b)(5) through the HQ AMC Command Counsel. Forward the list of nominees in a sealed envelope marked "Personal." Do not furnish copies to anyone other than the addressees in this paragraph.
(b)
(2) Prepare a written source selection plan for all source selections. Tailor the contents and extent of the of the plan consistent with the dollar value and complexity of the proposed acquisition. For formal source selections the plan shall conform to the requirements of DFARS 215.303(b)(2).
(b)(S-90)
(7) Approve the contracting officer's competitive range determination to exclude offerors from the competitive range at any point in the evaluation and selection process; and
(8) Approve requests for second or subsequent best and final offers.
(S-90) For formal source selections, the PEO/PM or functional proponent (non-PEO programs) for the acquisitions shall --
(a) Develop and implement the acquisition strategy.
(b) Prepare and obtain approval of the SSP before issuing the solicitation.
(c) Coordinate with the HCA to recommend an official as the SSA, when authority to appoint the SSA has been delegated by the AAE;
(d) Provide necessary funds for salaries, overtime, temporary duty travel and other expenses of the source selection and provide office space, office and administrative equipment, clerical support, and other necessary administrative support to personnel involved in the source selection.
15.304 -- Evaluation Factors and Significant Subfactors
(d) When the Government intends to evaluate the cost of future production or performance beyond the instant contract, and to include these costs as part of the basis of selection and award, clearly specify the evaluation procedures for such costs in the solicitation. Do not use Government estimates of future or life cycle costs in an evaluation unless the Government's procedures and methodologies for developing the costs are specified in the solicitation.
(S-90) Evaluate MANPRINT in source selections for major systems, designated acquisition programs and, when appropriate, other acquisition programs. Evaluate MANPRINT issues or opportunities that are specific, stand-alone functional requirements in the SOW, statement of objectives or other description, as identified in paragraph 4 or 5 of an ORD. MANPRINT may be a separate factor on the same level as "technical," "cost" or "management." Normally, proper integration of MANPRINT considerations requires inclusion of MANPRINT at some subfactor level in each and every area of proposal evaluation as appropriate for the acquisition.
15.305 -- Proposal Evaluation.
(a)
(1) Cost or price evaluation. Always evaluate and consider cost or price. Do not score cost or price or combine it with other aspects of the proposal evaluation. See FAR Part 36 regarding architect-engineer contracts.
(2) Past performance evaluation. See AFARS Subpart 42.15.
(3) Technical evaluation. Do not average or otherwise manipulate individual evaluator or unit scores to produce a single raw score for any factor or subfactor. Establish scores by evaluator consensus and not by vote. When divergent evaluations exist, and none of the evaluators have misinterpreted or misunderstood any aspects of the proposals, consider providing the SSA with written majority and minority opinions.
(4) Cost information. While providing cost information to members of the technical evaluation team is encouraged, the SSA shall determine whether such information shall be provided, when and what information shall be provided, and under what conditions.
15.306 -- Exchanges With Offerors After Receipt of Proposals
(c) Competitive Range. The SSA shall approve the competitive range determination. Scrutinize the selection of only one competitor as falling within the competitive range to ensure that the evaluation criteria are not too restrictive and the procurement is truly competitive.
15.404-1 -- Proposal Analysis Techniques
(b) Price Analysis.
(2)
(v) The Government estimate shall contain a statement by the preparing official giving the basis for developing the estimate and discussing its reliability. When it is not feasible or desirable to develop an estimate of the proper price level or value of the supplies or services to be purchased, the contracting officer shall so document the contract file.
(c) Cost Analysis.
(2)(iii)
(D) The Government estimate shall contain a statement by the preparing official giving the basis for developing the estimate and discussing its reliability. When it is not feasible or desirable to develop an estimate of the proper price level or value of the supplies or services to be purchased, the contracting officer shall so document the contract file.
15.406-1 -- Prenegotiation Objectives
(b) Document prenegotiation objectives in a Prenegotiation Objective Memorandum (POM) which sets forth the significant details of the proposed contracting action and the course the contracting officer proposed to pursue. Prepare, review and approve POMs in accordance with the activity's business clearance procedures.
15.406-3 -- Documenting the Negotiation
(a) A sample format is at AFARS 53.9010. Tailor the sample to the needs of the organization and the instant procurement.
15.407 -- Special Cost or Pricing Areas
15.404-76 -- Reporting Profit and Fee Statistics.
Use the Army Weighted Guidelines Software for reporting DD Form 1547 data. Obtain the software and instructions for its use from the addressee in 1.290(b)(6), Attn: WGL.
15.407-4 -- Should-Cost Review
(b) Program should-cost review.
(4) The HCA, in coordination with the PM or other customer, shall establish the requirements and format for the program should-cost team report.
15.490 -- Follow-Up on Contract Audit Reports.
(a) The Director for Information Management and Assessment, U.S. Army Contracting Support Agency, is the Army's contract audit follow-up official.
(b) PARCs shall perform the functions of the Army's contract audit follow-up official for their respective commands. PARCs shall --
(1) Establish and chair Overage Audit Review Boards;
(2) Ensure that the effective resolution and disposition of audit findings and recommendations in a timely manner while fully protecting the Government's interests is a factor in organizational and individual performance standards and objectives; and
(3) Maintain close surveillance of all contract audit reports and apply extraordinary efforts to resolve and dispose of any audit reported in accordance with 15.490-4(c).
(c) Chiefs of contracting or contract administration offices shall take personal interest in all contract audit reports being tracked by their office and assist contracting officers in the resolution and disposition of those audit recommendations which appear unlikely to be resolved within six months of the date of an audit report.
(d) Contracting officers shall --
(1) Make every effort to resolve the recommendations as described in DoDD 7640.2 not later than six months from the date of the audit report and dispose of those recommendations within 12 months;
(2) Invite the auditor to participate in the review when it is considered necessary; and
(3) Appear before the Overage Audit Review Board to discuss the resolution and disposition of any audit reported in accordance with 15.490-4(c).
15.490-2 -- Tracking of Contract Audit Report Recommendations.
(a) Centrally track all contract audit reports from request for audit through receipt, resolution and disposition. Each contracting or contract administration office, including satellite offices such as GOCOs, shall establish a single entity for requesting, receiving and tracking all audit reports. Provide the activity name, address, attention symbol, point of contact and telephone number of the single entity to the contract administration services office and DCAA regions involved.
(b) Centrally track and report audit report data in accordance with DoDD 7640.2. Maintain a file for each audit report and include in each file the following information:
(1) Report number.
(2) Activity address number.
(3) Issuing agency.
(4) Date of report.
(5) Contractor.
(6) Contract number(s).
(7) Organization responsible for disposition.
(8) Contracting officer responsible for disposition.
(9) Total amount subjected to audit.
(10) Total questioned costs.
(c) For reportable audit reports (see 15.490-3), the central files shall also include the following information:
(1) Type(s) of recommendations contained in report. Use the codes in DoDD 7640.2.
(2) Target date of resolution.
(3) Actual date of resolution.
(4) Target date for disposition.
(5) Date of final decision (if any) of contracting officer.
(6) Date of filing with Armed Services Board of Contract Appeals (ASBCA) or court (if any) and docket or case number.
(7) Disposition results in terms of questioned costs sustained.
The Status Report on Specified Contract Audit Reports (RCS DD-IG(SA)1580), as required by DoDD 7640.2, shall be submitted by each contracting or contract administration office to reach the addressee at 1.290(b)(6), Attn: CAF, not later than 15 April and 15 October of each year. Use the Army Contract Audit Follow-up Automated Program for the status report. Obtain the Program and instructions from the addressee at 1.290(b)(6). Negative reports are required.
15.490-4 -- Overage Audit Review Boards.
(a) Make every effort to resolve audit recommendations within six months of the date of an audit report and dispose of them within 12 months. Each PARC shall establish and chair an Overage Audit Review Board (the Board) to review the status of open audits reported as overage or unresolved on the Status Report on Specified Contract Audit Reports.
(1) The PARC shall chair the Board. The Board shall:
(i) Be composed of the contracting activity's senior legal, contracting, and pricing personnel.
(ii) Review all open, unresolved audits over six months old and resolved audits over 12 months old that are reported as open on the most recent Status Report on Specified Contract Audit Reports.
(iii) Meet early in November to consider those audits reported on the report due 15 October and early in May to consider those audits listed on the report due 15 April. The Board may meet at other times, as necessary.
(iv) Hear the contracting officer's presentation of efforts to resolve and dispose of the audit recommendations.
(v) Assist the contracting officer in developing a plan of action for timely resolution and disposition of the audit recommendations.
(vi) Provide the contracting officer with necessary guidance and assistance to resolve and dispose of the audit recommendations. This shall include reordering priorities, assigning additional or alternate resources or committing the personal attention of the HCA or the PARC to the effort.
(b) If the PARC determines that it is not practical to have the contracting officer attend the Board meeting because of distance or other reasons, the PARC may authorize a local board chaired by the PARC's designee. The local board shall follow the guidance in (a) and shall submit its report to the PARC in time for the PARC to review, approve and incorporate it into the PARC's submittal to HQDA.
(c) Upon completion of its review, but not later than 30 November and 31 May, the Overage Audit Review Board shall submit to the addressee in 1.290(b)(6), under a summary cover letter from the PARC, a detailed plan of action for the resolution and disposition of each audit report in the three major categories listed in (1).
(1) The Board shall separate the audits into the following three major categories for reporting:
(i) 6-12 months old, unresolved.
(ii) Overage (over 12 months old), unresolved.
(iii) Overage (over 12 months old), resolved.
(2) Each plan of action shall contain the following information:
(i) Audit report number.
(ii) Report date.
(iii) Contractor name.
(iv) Type of audit.
(v) Cost questioned or cost avoidance.
(vi) A narrative plan of action for resolution and disposition of the audit findings.
(vii) Target resolution date.
(viii) Target disposition date.
(ix) Contracting officer's name.
(x) Contracting officer's phone number.
(3) The Board's report shall describe the action taken under (a)(6) and (7) and identify attendees and their role in the process, such as contracting officer or chief of pricing.
Subpart 15.6
Unsolicited Proposals
Army procedures pertaining to unsolicited proposals are found in Appendix XVIII of DA Pamphlet 70-3, Army Acquisition Procedures. DA PAM 70-3 may be found in the Library section of the Homepage of the Assistant Secretary of the Army (Acquisition, Logistics and Technology) and in the Defense Acquisition Deskbook.