Pricing_Instruction_Revision_1.doc

Pricing Instructions-Revision 1

1. In addition to proposal submittal through ARMDEC, the Offeror (Prime Contractor) shall submit one additional electronic copy to the Navy Price Fighters (NPF) and DCMA Commercial Item Group (CIG), if applicable.

2. The Offeror shall take actions to ensure the proposal is current throughout the acquisition

3. All contractor proposals shall be submitted in accordance with FAR 15.408, Table 15-2. In order to ensure initial submission of a fully compliant and adequate proposal, and subsequently avoid any delays associated with proposal inadequacies and excessive proposal preparation costs, the DFARS 252.215-7009 Proposal Adequacy Checklist (PAC) must be completed and provided as part of the proposal. The responsibility for providing a well-prepared and fully supported cost proposal lies solely with the Offeror. If the Offeror is unsure as to whether a checklist item is required in support of the proposal, or how to adequately comply with a checklist item, the Offeror shall contact the Contracting Officer as soon as possible after receipt of the RFP, but in any case prior to proposal submittal, to resolve the questions. Non-compliances with the attached checklist may result in the return of the proposal. If non-compliances occur, a revised and adequate proposal must be received within 15 calendar days. Minor non-compliances will require immediate correction in order to proceed with proposal evaluations and negotiations. Any instructions within the RFP take precedent over the checklist. The Offeror is encouraged to flow down this provision to subcontractors/affiliates required to submit certified cost and pricing data. Substantial proposal inadequacies or deficiencies may result in proposal preparation costs being disallowed and the Contracting Officer will consider the nature and extent of any proposal inadequacies when assessing/negotiating profit. The contractor shall include all supporting data for the Basis of Estimate (BOE) on the BOE or as an attachment to the BOE. In addition, the following areas are specifically highlighted:

a. A complete and thorough technical and cost/price analysis of each subcontractor/vendor to be awarded non-competitively and proposed in excess of $2,000,000 must be provided at the time of proposal submittal. If cost/price analysis of each subcontractor is not available at the time of proposal submittal, the contractor shall provide a schedule of when each subcontractor analysis will be submitted. Negotiations will not start until these analyses are provided. It should be noted that a dual award to two sources does not constitute competition.

b. If any subcontractor amount exceeds $13.5M, or 10% of the overall price and in excess of $2,000,000, a copy of the subcontractor’s un-redacted proposal containing cost or pricing data is due concurrent with the submission of the proposal but no later than 5 days after receipt of the subcontract proposal by the Prime Contractor. Additionally, any subcontract terms or conditions are also to be submitted with the proposal. If the subcontractor refuses to submit an un-redacted proposal to the prime due to proprietary data, the prime shall notify the government prior to proposal submittal. The prime shall have the subcontractor submit any proprietary data directly to the Contracting Officer. Additionally, any invoices submitted to support commerciality shall be un-redacted.

4. The Offeror shall conduct a proposal walkthrough as requested. To facilitate a timely and meaningful walkthrough supporting data for the discussion topics shall be provided 72 hours in advance of the scheduled walkthrough.

5. Basis of Estimates (BOEs) shall use actual and recent data, as close as possible to actual proposal submission date. Estimating rationale such as “per management direction”, “engineering judgment”, or any other debatable substantiation should be avoided whenever possible.

6. The Offeror shall keep Robins AFB contracting personnel informed of schedule(s) to negotiate key supplier proposals. If supplier negotiations have concluded, the Prime Contractor shall provide memos of negotiation and basis for the negotiated fair and reasonable price.

7. In addition to the requirements identified in the DFARS PAC, the following also apply to the cost proposal submitted.

a. Breakout by year. If the proposal includes more than one Contract Line Item (CLIN), the proposal shall include a breakout of CLIN prices by cost element by Contractor Fiscal Year (CFY). At the Contracting Officer’s direction, the breakout by year shall also be provided by Calendar Year (CY). The proposal shall define the timeframe of the Offeror Fiscal Year (for example, January – December).

b. If the proposal includes more than one CLIN/subCLIN, recurring/non-recurring costs shall be identified for each CLIN/subCLIN.

c. When the proposal includes material costs, the proposal shall include a consolidated bill of materials (CBOM) at the total contract level in an electronic, sortable format (Excel spreadsheet or other format approved by the Contracting Officer). Vendor names are required for each part number.

d. When the amounts proposed in the CBOM include application of escalation, the proposal shall identify the base value, the escalation rate(s) used, and the escalation amount associated with each item escalated.

e. When the amounts proposed in the CBOM for material include minimum buys, the minimum buy quantity and cost shall be clearly identified.

f. When the proposed amount is based on historical data which has been adjusted (for example, for differences in quantity), the CBOM shall clearly identify the adjustments made to the historical data and the reason for each adjustment.

g. An electronic CBOM providing traceability to the CLIN level, to WBS paragraph, etc. is required.

h. Prime shall submit with the proposal any Purchase order history, quotes or long term agreements for the top 80% of material line items as basis of estimates for material costs.

8. All costs proposed on the basis of Cost Estimating Relationships (CER) shall be fully supported. The proposal shall identify the basis for the proposed rate, shall identify the base to which the rate is applied, and shall clearly demonstrate the calculation of proposed costs based on CERs.

9. Actual Costs Incurred. Provide all incurred cost or pricing data related to any other similar Engineering and Manufacturing (EMD) contracts issued from the Government to the Offeror. When possible, aforementioned data should be used as the basis of estimate.

10. The Offeror shall provide the following information for these prior acquisitions: For these contracts, the Offeror shall provide the following information:

a. contract number (including modification number if applicable) or other identifier;

b. contract type;

c. contract quantity;

d. contract price; and

e. actual cost incurred, including a breakout of actuals as recurring/non-recurring costs, with Direct labor hours and direct material separately identified. If performance is not complete on any of the specified contract actions, provide an estimate to complete and the basis for that estimate.

11. The Offeror shall also request that its top five (5) major sole source subcontractors provide the information listed in the above paragraphs 10, a. through e., on prior contracts for items the prime is purchasing from the subcontractors for this effort. If a subcontractor’s information on prior actuals is not included in the prime’s proposal, the proposal should identify status and anticipated receipt date(s). If the subcontractor deems the information proprietary, the subcontractor may submit the information directly to the Contracting Officer.

12. The proposal shall identify those actions where assist audits have been requested by the prime or sub-tier contractors and identify the request date and scheduled receipt date for those audits. The need for assist audits resulting from proprietary data rights assertions at any tier shall be identified to the Contracting Officer as soon as the Offeror becomes aware of the need. Government performance of assist audits does not relieve the Offeror of the responsibility to accomplish and provide its price/cost analysis of the subcontracts.

13. The Offeror’s proposal shall provide support for any subcontractor Commercial Item Determinations (CID), addressing, at a minimum, the following:

a. A description of the supplies or services;

b. Specific identification of the type of commercial item claim (FAR 2.101 commercial item sub-definitions (1) through (8)), and the basis on which the item meets the definition; and

c. For modified commercial items (commercial item sub-definition (3)), classification of the modification(s) with supporting rationale as either:

i. Of a type customarily available in the commercial marketplace (FAR 2.101 Commercial item sub-definition (3)(i)); or

ii. A minor modification of a type not customarily available in the commercial marketplace made to meet Federal Government requirements (FAR 2.101 commercial item sub-definition (3)(ii)).

Note that per FAR 15.403-1(c)(3)(iii)(B), modifications that meet the definition of minor modifications of a type not customarily available in the commercial marketplace as defined in FAR 2.101, paragraph (3)(ii) of the commercial item definition, will require the submission of certified cost and pricing data when the total price of all such modifications exceeds the greater of the threshold for certified cost or pricing data (FAR 15.403-4) or 5% of the total price of the contract at the time of contract award.

All CID support shall be presented un-redacted.

14. For proposed subcontract commercial items “of a type”, or “evolved” or modified (FAR 2.101 commercial item sub-definitions (1) through (3)), the Offeror shall provide a technical description of the differences between the proposed item and the comparison item and thoroughly address the cost differences between the proposed item and the comparison item.

15. The proposal shall include, or the Offeror shall make available, data other than certified cost or pricing data to establish price reasonableness of the proposed subcontract commercial item (to include any modifications not subject to the requirement to submit certified cost or pricing data) by supplying:

a. Information/data related to competition, if competition is the Offeror’s basis for asserting the reasonableness of the proposed subcontract price.

b. Information/data related to prices (sales data, market price assessments, etc.). Note that subcontractors may submit sales data directly to the CO if the subcontractor deems the data proprietary.

c. The prime contractor’s or higher tier subcontractor’s price analysis/price reasonableness determination for the commercial subcontract in accordance with FAR 15.404-3(b)(1) and (2).

d. Cost information/data (cost element breakdown and supporting documentation not subject to certification in accordance with FAR 15.406-2). Instances where cost information may be required include but are not limited to commercial items offered but never actually sold to the public, “of a type” commercial items, or when sales data is limited and/or not recent and/or not for the same/similar quantities.

e. Note that the preferred method of establishing the price reasonableness of commercial items is to obtain commercial sales data. It is recognized that other methods, such as market price assessment data or evaluation of cost data not subject to certification, are also acceptable when prior sales data cannot be obtained. Sales data shall (1) demonstrate sales to the general public; (2) be current; and (3) where possible, be in like quantities. Items sold to state, local, or foreign governments or items sold with applications only to state, local, or foreign government or US Government end items are not considered to be sales to the general public unless the proposed commercial item meets the FAR 2.101 commercial item definition sub-definition (8).

16. REMOVED

17. Submission of electronic cost model. The contractor shall submit a live Excel Cost Model by Calendar Year and Program Year by Cost Element by CLIN that links each WBS to the applicable CLINS with a total summary by Cost Element for each Program Year and a total summary for all five (5) years by Cost Element. This Excel Cost Model shall calculate all formulas with the appropriate base(s) rates, and amount. All information supporting each CLIN should be visible and verifiable in the Excel Model. The government requests this same information be provided by flow down to your subcontractors and IWOs. The requirement of the submission of an electronic cost model is also applicable to all major subcontractors and IWOs identified in the proposal.