Atch 12 - Section M.docx

Section M - Evaluation Factors for Award

CLAUSES INCORPORATED BY REFERENCE

SECTION M INSTRUCTIONS

Section M - Evaluation Factors for Award

M-1.0 Introduction The Government will evaluate the Offeror‘s proposals In Accordance With (IAW) the criteria specified in this section.

M-2.0 Basis for Award This is a competitive, best value, source selection that will be conducted in accordance with Federal Acquisition Regulation (FAR) Part 15.3 and Defense Federal Acquisition Regulation Supplement (DFARS) Part 215.3. In using this best value approach, the Government seeks to award to an Offeror who gives the Missile Defense Agency the greatest confidence that it will best meet the Government’s requirements in an affordable manner. To arrive at a source selection decision, the Source Selection Authority (SSA) will integrate the source selection team’s evaluations of the evaluation factors and subfactors described below. While the Government source selection evaluation team and the SSA will strive for the maximum objectivity, the source selection process, by its nature, is subjective, and therefore, professional judgment is implicit throughout the entire process. This may result in an award being made to a higher rated, higher priced Offeror where the decision is consistent with the evaluation factors and the SSA reasonably determines that the technical superiority, and/or overall business approach, and/or superior past performance, of the higher priced Offeror outweighs the cost difference.

M-3.0 Evaluation Factors and Subfactors All proposals received will be subject to technical, management, past and present performance and cost/price evaluation by a Technical Evaluation Team, a Performance Risk Assessment Group, and a Contract Evaluation Team. A color code rating technique will be used to evaluate the Technical and Management Proposals at the subfactor level. A separate risk rating will be used to assess the risk associated with each subfactor. The Cost/Price Proposal will not be given a color rating. Award will be made to the Offeror proposing the combination most advantageous to the Government based upon an integrated assessment of the evaluation factors and subfactors described below. The Technical and Management Evaluation are of equal importance, and are more important than the Past Performance Factor . When combined, these three Factors are significantly more important than Cost/Price. The Technical Subfactors 1 through 6 are of equal importance. The Management Subfactors 1 through 5 are of equal importance. Color and proposal risk ratings will be assigned at the Technical and Management subfactor level. Past and Present Performance will receive an overall performance confidence rating. Cost/price will be evaluated for reasonableness and realism and will be considered as part of the integrated assessment of best value. The non-cost factors, when combined, are significantly more important that cost/price, but cost/price will contribute substantially to the Source Selection decision. The lowest priced proposal may not necessarily receive the award; likewise, the highest technically rated proposal may not necessarily receive the award. The Government will select for award the proposal that is most advantageous and represents the best value to the Government using the factors and subfactors set forth below.

Evaluation Methodology and Definitions. Throughout the evaluation, evaluators examine each Offeror's response to the solicitation requirements, identifying ambiguities that may need clarification, strengths, weaknesses, and deficiencies. The different types of comments and the methods of documenting them are described below. Evaluators must document deficiencies during their review of the proposal.

NOTE; THE ABOVE EDITS CONFORM WITH THE NEW DOD SOURCE SELECTION PROCEDURES

Factor 1: Technical Subfactor 1: Information Technology Subfactor 2: Software Subfactor 3: Test and Evaluation Data Acquisition and Communications Subfactor 4: Telemetry Operations Subfactor 5: Truth Analysis Subfactor 6: Library Operations

Factor 2: Management Subfactor 1: Team Subfactor 2: Management Approach Subfactor 3: Programmatic Execution Approach Subfactor 4: Transition Subfactor 5: Small Business Compliance

Factor 3: Past Performance

Factor 4: Cost / Price

M-3.1 Technical, Factor 1 and Management, Factor 2 Evaluation of these factors shall focus on the degree to which the proposed approach meets or does not meet the minimum performance or capability requirements through an assessment of the strengths, weaknesses, deficiencies, and risks of a proposal using the following color ratings. Offerors are encouraged to reference previous experience in performing work of the same scope and magnitude in order to demonstrate their capability to meet or exceed requirements and to support the Government’s assessment of actual mission capability. Discussion of previous experience should detail factual accomplishment and how it will be applied to meet or exceed the MDDC requirements.

The Government will favorably consider proposed innovations and efficiencies that decrease cost and/or enhance contract schedule and/or performance, are of benefit to the Government, and are in enough detail to be made contractually binding and will in fact be incorporated into the successful offeror’s resulting contract, if awarded. To support the Government’s determination of actual benefit, the Offeror may discuss any cost advantages that may or may not appear in the Cost/Price Proposal. Favorable assessments will be based on the extent to which Offerors demonstrate a commitment to provide additional benefits to the MDA and MDDC mission, such as providing higher output, capability, and quality, or exceeding performance thresholds identified in the SOW.

The Government will not roll up subfactor ratings into an overall color rating for Technical or Management. Note a deficiency (defined above) in the Offeror’s proposal could render the Offeror’s proposal unawardable. Also see paragraph M-4.0.

Subfactor Color Ratings

Risk will be rated separately from the strengths, weaknesses, and deficiencies that determine the technical/management subfactor ratings. Assessment of risk, which is manifested by the identification of weakness(es), considers potential for disruption of schedule, increased costs, degradation of performance, the need for increased Government oversight, or the likelihood of unsuccessful contract performance. Assessment of risk will be accomplished at the subfactor level and will not be rolled up to the factor level. Proposal risk will be evaluated using the following risk ratings:

Subfactor Risk Ratings

M-3.2 Past and Present Performance – Factor 3 The past and present performance evaluation will result in an assignment of a performance confidence assessment rating. The Offeror’s recent and relevant past and present performance will focus on performance that is relevant to the Technical and Management subfactors.

The recency and relevancy of the past performance information is critical in determining what contracts will be evaluated. Current performance will have greater impact in the performance confidence assessment than less recent performance, however, performance must have occurred within the last five years in order to be evaluated. In determining relevancy, consideration will be given to, but will not be limited to, such things as project similarity, project complexity, contract type, and subcontractor interaction. In performing the past performance evaluation, each Offeror will be assigned a relevance rating in accordance with paragraph L-7.2 and a confidence rating in accordance with paragraph L-7.5.

M-3.3 Cost/Price – Factor 4 Although less important than the three non-price factors combined, the Cost/Price Factor will contribute substantially to the source selection decision. While cost/price will not be rated or color coded, it will be evaluated in terms of realism. Unrealistically high or low price, initially or subsequently, may be grounds for eliminating a proposal from competition.

M-4.0 Competitive Range In accordance with FAR 15.306(c)(1), the contracting officer may establish a competitive range comprised of the highest rated proposals based on the ratings of each proposal against all of the evaluation criteria. If the SSA determines that an Offeror’s proposal should no longer be included in the competitive range, the proposal will be eliminated from consideration for award and written notice of the decision will be provided to the unsuccessful Offeror in accordance with FAR 15.503.

M-4.1 Discussions To maximize the Government’s ability to obtain the best value, based on the requirement and the evaluation factors set forth in this solicitation, it may be necessary to conduct discussions. Discussions may be conducted either orally or in writing. The scope and extent of the discussions are a matter of contracting officer judgment as set forth in FAR 15.306. Offerors may be restricted to a short turnaround (less than 24 hours) in responding to the contracting officer. Offerors should present their very best proposal as their initial proposal. Offerors are strongly advised to thoroughly examine their proposals for accuracy, complete documentation, clear explanations and compliance with all requirements of the solicitation prior to submission to the contracting officer. The Government does not plan to conduct successive rounds of discussions to give Offerors the opportunity to strengthen weak proposals.

M-4.2 Final Proposal Revisions If discussions are conducted, final proposal revisions will be required in determining the award of the contract resulting from this solicitation. Offerors are advised that unsupported final proposal revisions may be penalized in the overall proposal evaluation, and an otherwise acceptable proposal could be placed in jeopardy. However, the Government reserves the right to award a contract without discussions or opportunity for proposal revisions, in which case, final proposal revisions will not be required.

M-4.3 Rejection of Unrealistic Offers The Government may reject any proposal that is determined to be unrealistic in terms of program commitments, including contract terms and conditions, or unrealistically high or low cost when compared to the Government estimate, such that the proposal is deemed to reflect an inherent lack of competence or failure to comprehend the complexity and risks of the program.

M-4.4 Solicitation Requirements, Terms and Conditions Offerors are required to meet all solicitation requirements, such as terms and conditions, representations and certifications, and technical requirements, in addition to those identified as factors and subfactors to be eligible for award. Failure to comply with the terms and conditions of the solicitation may result in the Offeror being removed from consideration for award.

M-5.0 FACTOR 1 - TECHNICAL

M-5.1 Technical Subfactor 1 – Information Technology

This subfactor primarily focuses on SOW Section 4.2, Test Support Systems; SOW Section 4.6, Information Technology Infrastructure; and SOW Section 5., Mission Focus.

The Government will evaluate the extent to which the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to execute Information Technology activities, including:

1) Offeror demonstrates knowledge and experience in managing the day to day activities and processes associated with IT system and network management operations; the recruitment and staffing of a well-trained, knowledgeable IT work force; the short- and long-term technical direction planning; and IT inventory and cost management sustainment activities for Information Technology (IT) classified and unclassified networks and systems with the following requirements:

a. Manage, administrate and document large network architectures with >100 physical and virtual servers in concurrent use, 250+ users/workstations, and data/file repositories >25 TB that are backed up on a frequent, periodic schedule.

b. Maintains multiple network access points to include file transfer capabilities to external sites.

c. Familiarity with administration and management of network architecture hardware and software including Microsoft Windows Server, Linux distributions, Cisco networking equipment and Cisco IOS, and Storage Array Networks.

2) Offeror demonstrates knowledge to accredit Information Technology classified and unclassified networks and systems IAW the DoD Information Assurance Certification and Accreditation Process (DIACAP).

3) Offeror demonstrates the technical competence and approach to develop and manage Information Assurance plans and procedures.

M-5.2 Technical Subfactor 2 - Software

This subfactor primarily focuses on SOW Section 4.2, Test Support Systems; SOW Section 4.5, Software Development; and SOW Section 5, Mission Focus.

The Government will evaluate the extent to which the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to execute Information Technology activities, including:

1) Offeror demonstrates the capability to execute and manage Software Development activities necessary to provide software development in support of MDDC Program operations at a level commensurate with Software Engineering Institute/Capability Maturity Model Integration (SEI/CMMI) Level 3; demonstration of knowledge and expertise regarding processes, procedures, and configuration management approach on similar sized activities.

2) Offeror demonstrates technical competence to design, develop, and implement complex software systems with the following requirements:

a. Managing and utilizing a codebase >50,000 LOC (lines of code);

b. Use of complex mathematical constructs (such as: matrix and coordinate transformations, linear interpolation, vector mathematics, quaternions);

c. Development of graphical user interfaces to support 3D modeling;

d. Use of authentication and authorization security paradigms;

e. Interconnectivity and use of database systems within the codebase;

f. Familiarity and use of link margin analysis/planning toolsets;

g. Familiarity with and use of:

i. C#, C++, Adobe CFML (Coldfusion Markup Language), SQL (Structured Query Language);

ii. Microsoft SQL Server;

iii. Windows Authentication/Authorization methods.

M-5.3 Technical Subfactor 3 - Test and Evaluation Data Acquisition and Communications

This subfactor primarily focuses on SOW Section 4.2, Test Support Systems and SOW Section 5., Mission Focus.

The Government will evaluate the extent to which the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to execute product development, sustainment and integration, including:

1) Experience and the technical competencies to acquire and process critical flight test data (telemetry, radar, optical, etc.), record and distribute in real-time across the MDA communications network. Emphasis is placed on bandwidth management/compression, data tagging to support sensor cueing/pointing for range and mobile sensors at primary and remote execution nodes.

2) Experience in planning and executing comprehensive flight test data architectures and provide real-time/non-real time situational awareness displays at primary and remote execution nodes to support high-fidelity data driven displays, video relay, mission voice nets and countdown clock displays across the MDA communications network.

M-5.4 Technical Subfactor 4 – Telemetry Operations

This subfactor primarily focuses on SOW Section 4.2, Test Support Systems and SOW Section 5., Mission Focus.

The Government will evaluate the extent to which the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to execute product development, sustainment and integration, including:

1) Expertise and experience to acquire telemetry data from multiple sources, decommutate/process telemetry from target and interceptor telemetry streams, record, reduce telemetry to critical key parameters and disseminate real-time across the MDA communications network necessary to support flight test launch operations.

2) Experience and the technical capability to develop target health and status displays which support real-time launch decision authority and range safety assessment.

3) Demonstrates the technical capability to operate, indentify, report and resolve anomalies with government furnished equipment for global positioning system data supporting mission analysis and range safety solutions.

4) Capability in the planning and execution of complex flight test architectures using a systematic systems engineering process to collect quantifying MDA BMDS weapon system performance parameters.

M-5.5 Technical Subfactor 5 – Truth Analysis

This subfactor primarily focuses on SOW Section 4.4, Truth Analysis and SOW Section 5., Mission Focus.

The Government will evaluate the extent to which the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to execute Truth Analysis activities, including:

1) Experience and technical capability to develop best estimate trajectories (BETS) for all interceptor and target objects, instrumented or un-instrumented.

2) Experience and technical capability to develop BETS in multiple reference frames and formats.

3) Experience and technical capability to perform both Infrared (IR) and radar frequency phenomenology analysis.

4) Experience and technical capability to identify, report, and resolve anomalies seen in Truth analysis activities.

M-5.6 Technical Subfactor 6 – Library Operations

This subfactor primarily focuses on SOW Section 4.1, Library Operations and SOW Section 5., Mission Focus.

The Government will evaluate the extent the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to execute Library Operations across the MDDC Program, including:

1) Offeror demonstrates experience and technical competence to manage and operate a technical library with >100,000 different data items in a variety of media types (i.e.: CD, DVD, tapes, paper, etc.).

2) Offeror demonstrates experience and technical competence to distribute data electronically and physically.

3) Offeror demonstrates experience and technical competence to maintain accountability of data items IAW DoD and MDA security policies and guidance.

M-6.0 FACTOR 2 - MANAGEMENT

M-6.1 Management Subfactor 1 - Team

This subfactor primarily focuses on SOW Sections 2., Management; SOW Section 3., Mission Assurance; SOW Section 4., Operations and Sustainment; SOW Section 5., Mission Focus; SOW Section 6., Security; and SOW Section 7. Special Provisions.

The Government will evaluate the extent the Offeror’s proposal clearly identifies a Team and framework including subcontractors necessary to successfully execute the MDDC Program SOW and provide flexible, responsive, innovative, and efficient MDDC Program products and operations.

1) Offeror identifies a team and framework including subcontractors that details roles, lines of authority, and the management and technical communication process that addresses the MDDC Program SOW as a whole.

2) Offeror identifies key positions within the organizational structure that can support the requirements of the SOW, their planned responsibilities, and details their experience most applicable to the SOW.

M-6.2 Management Subfactor 2 - Management Approach

This subfactor primarily focuses on SOW Sections 2., Management; SOW Section 3., Mission Assurance; SOW Section 4., Operations and Sustainment; SOW Section 5., Mission Focus; SOW Section 6., Security; and SOW Section 7. Special Provisions.

The Government will evaluate the extent the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s team has the capability and capacity to organize resources to most efficiently and effectively manage contract execution and mitigate program risk.

1) Offeror identifies a program-wide approach to managing technical, performance, cost, and schedule risk.

2) Offeror identifies a planned process to organize, staff, and allocate resources to meet the SOW. Offeror identifies an approach for recruitment and retention to ensure personnel are in place and trained.

3) Offeror identifies their approach to provide a crossed-trained work force for SOW efficiencies.

4) Offeror identifies their risk management approach to identify, track, and mitigate program risk.

5) Offeror identifies their understanding of the scope and interaction of activities within the MDDC Program by providing a Contract Work Breakdown Structure (CWBS) and CWBS dictionary that reflect the MDDC program.

M-6.3 Management Subfactor 3 - Programmatic Execution Approach

This subfactor primarily focuses on SOW Sections 2, Management; SOW Section 3., Mission Assurance; SOW Section 4., Operations and Sustainment; SOW Section 5., Mission Focus; SOW Section 6., Security; and SOW Section 7. Special Provisions.

The Government will evaluate the extent the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s Team has the capability to provide a Management Plan/System for effective planning and control of resources, and the process for accounting and collecting costs for the entire contract, separate tasks, and ACRNs to accomplish multiple and complex tasks and/or task orders simultaneously.

M-6.4 Management Subfactor 4 – Transition

This subfactor primarily focuses on SOW Sections 2., Management; SOW Section 3., Mission Assurance; SOW Section 4., Operations and Sustainment; SOW Section 5., Mission Focus; SOW Section 6., Security; and SOW Section 7. Special Provisions.

The Government will evaluate the extent the Offeror’s proposal states clearly and provides credible evidence that the Offeror’s Team has the capacity and capability to provide a plan and resources to work with the incumbent contractor(s) during the transition period to maintain all MDDC Program mission and SOW requirements and to complete the transition period within the minimum time and cost.

1) Offeror demonstrates the ability to transition resources and personnel to this contract required to perform the MDDC Program mission and SOW requirements.

2) Offeror identifies a process to work with the incumbent contractor(s) to smoothly transition the MDDC Program products / operations.

3) Offeror identifies a realistic schedule, which includes key milestones with metrics to measure progress, to successfully transition all tasks within a designated transition period of no more than 45 days.

4) Offeror identifies a phase-in schedule that would obtain the appropriate staffing levels, skill mix, expertise, security clearances, and certifications to provide adequate trained, certified, and cleared personnel.

M-6.5 Management Subfactor 5 – Small Business Compliance

Small Business Compliance: Proposals will be evaluated to determine the reasonableness of the offeror’s proposed plan to meet the 50% rule.

M-7.0 FACTOR 3 - PAST AND PRESENT PERFORMANCE

The Government will conduct an assessment of the Offeror’s, team members’, subcontractors’, and/or subsidiaries’ past performance. Major or critical subcontractors and/or subsidiaries are those which perform 20 percent or more or $10M, whichever is less, of the proposed cost of this effort and/or whose performance on the awarded contract is such that if it fails, could significantly impact program success. Past performance regarding predecessor companies or key subcontractors, and/or subsidiaries that will perform critical aspects of the requirement will be considered the same as past performance information of the principal Offeror.

The purpose of this assessment is to determine the Government’s confidence in the Offeror’s probability of successfully performing the required effort based on the demonstrated recent and relevant record of performance in supplying products and services that meet the contract’s requirements. Past performance is an integrated assessment of recency, relevancy, and quality and results in a Performance Confidence Rating as defined in the table in paragraph 7.4. The Performance Risk Assessment Group (PRAG) will evaluate all contracts submitted by the Offerors in their Volume III Past Performance for recency, using the criteria in paragraph 7.1 below, and relevancy, using the Relevancy Criteria Definitions in paragraph 7.2. The PRAG will evaluate recent and relevant past performance history and each Offeror will receive a single Performance Confidence Rating for the Past Performance Factor using the ratings described in the table provided in paragraph 7.4.

In conducting this assessment, the Government reserves the right to use both data provided by the Offeror as well as data obtained from other sources like Contractor Performance Assessment Reporting Systems, similar systems of other Government departments and agencies, questionnaires tailored to the circumstances of this acquisition, Defense Contract Management Agency channels, interviews with program managers and contracting officers, and other sources known to the Government, including commercial sources.

M-7.1 Recency The Government will only consider recent work, which is defined as work performed during the five-year period preceding the date of solicitation release. Note: If any part of the performance falls within the above timeframe, the contract in its entirety may be evaluated for past performance.

M-7.2 Relevancy If the past performance information is recent, as defined in paragraph 7.1 above, the relevancy assessment will be conducted on past Offeror contracts. Relevancy , as it pertains to past performance information , is a measure of the extent of similarity between the service/support effort, complexity, dollar value, contract type, and subcontract of other comparable attributes of past performance examples and these requirements; and a measure of the likelihood that the past performance is an indicator of future performance. This area demonstrates the depth and breadth of relevant experience of the Offeror, including major or critical subcontractors and/or subsidiaries. Relevancy for the Offeror’s past contracts will be assigned in accordance with the definition outlined in the table below. The PRAG will conduct an in-depth review and evaluation of all performance data obtained to determine how closely the work performed under those efforts relates to the proposed effort. In determining relevancy for individual contracts, consideration will be given to the effort, or portion of the effort, being proposed by the Offeror, major or critical subcontractors and/or subsidiaries whose contract is being reviewed and evaluated. Higher relevancy will be assessed for contracts that are most similar to the effort, or portion of the effort.

Relevancy Criteria Definitions

M-7.3 Quality Assessment The quality assessment is an evaluation that determines how well the offeror performed on past contracts. The Past Performance Team will review this past performance information and determine the quality and usefulness as it applies to performance confidence assessment.

M-7.4 Performance Confidence Assessment and Rating Based on an integrated assessment of recency, relevancy, and quality, the PRAG will then determine and assign an overall Performance Confidence Rating for the Past Performance Factor in accordance with paragraph 4.2. The Past Performance evaluation will be accomplished by reviewing the aspects of the Offeror’s past performance focusing on the Offeror’s history of providing its customers with a quality product/service on contracts of similar size, complexity and scope that was delivered within budget and on schedule. This rating will represent an overall assessment of Offeror’s past performance. Offerors without a record of recent and relevant past performance or for whom information on past performance is not available will not be evaluated favorably or unfavorably on past performance and, as a result, will receive an "Neutral/Unknown Confidence" rating for the Past Performance Factor. A more recent and relevant record of favorable performance will result in a higher Performance Confidence Rating than a less recent and/or relevant record of favorable performance. A record of exceptional or very good confidence rating will be considered more advantageous to the Government than a record of “Neutral/Unknown Confidence”. In performing the past performance evaluation, each Offeror will be assigned one of the following confidence ratings:

Performance Confidence Ratings

Substantial Confidence Based on the offeror’s recent/relevant performance record, the Government has a high expectation that the offeror will successfully perform the required effort.

M-7.5 Adverse Past Performance Adverse past performance information is defined as past performance information that supports a less than satisfactory rating on any evaluation aspect or any unfavorable comments received from sources without a formal rating system. When relevant performance record indicates performance problems, the Government will consider the number and severity of the problems and the appropriateness and effectiveness of any corrective actions taken (not just planned or promised). The Government may review more recent contracts or performance evaluations to ensure corrective actions have been implemented and to evaluate their effectiveness.

In accordance with FAR 15.306(b)(1)(i), communications must be held with any Offeror whose adverse past performance information is the determining factor preventing it from being included in the competitive range, unless the Offeror has previously had the opportunity to comment on such information. Furthermore, the contracting officer must discuss adverse past performance with each offeror still being considered for award. See FAR 15.306.

M-8.0 FACTOR 4 – COST/PRICE

Evaluation of an Offeror’s proposal shall be based on the information presented in the proposal and information available to the contracting office from sources deemed appropriate. Sources typically considered include the Defense Contract Audit Agency, Defense Contract Management Administration offices, and other contracts with same firms for similar items or services, and known commercial sources.

M-8.1 Government Evaluation The cost area is comprised of an assessment of cost realism and total evaluated probable cost. The Total Evaluated Probable Cost will be presented to the Source Selection Authority. Cost/Price will not receive a color rating. The Government will evaluate each Offeror’s cost/price proposal using one or more of the techniques described in FAR 15.404 to determine the Total Evaluated Probable Cost to the Government of successfully completing the contract using the Offeror’s unique approach. Cost/Price will be assessed in accordance with the following criteria:

M-8.2 Realism The burden of proof for cost realism rests with the Offeror. Cost realism analysis is the process of independently reviewing and evaluating specific elements of each Offeror’s proposed cost estimate to determine whether the estimated proposed cost elements are realistic for the work to be performed; reflect a clear understanding of the requirements; and are consistent with the unique methods of performance and materials described in the Offeror’s technical proposal.

The Government will determine the most probable cost of performance for those efforts, taking into consideration the Offeror’s technical and management approaches proposed, unique business methods, operating procedures, and practices. The most probable cost may differ from the proposed cost and will reflect the Government’s best estimate of the cost that is most likely to result from the Offeror’s proposal. The most probable cost (before fee) is determined by adjusting the Offeror’s proposed cost, when appropriate, to reflect any additions or reductions in cost elements based on the results of the cost realism analysis.

M-8.3 Total Evaluated Probable Cost Total Evaluated Probable Cost consists of the Government’s estimate of the realistic cost of successfully completing the CPIF line items as discussed in paragraph 9.2, plus the total amount of any additional costs to the Government which are necessary to support the Offeror’s unique approach (e.g. the Government-assessed value associated with GFE, information, and facilities shown in the GFE attachment in Section J; other rent-free Government property proposed by the Offeror; and Government furnished range services). The Government will also adjust the incentive fee in accordance with the Offeror’s proposed incentive fee adjustment formula, and add the proposed award fee amounts. The Total Evaluated Probable Cost will be used in the Government’s best value assessment.

M-8.4 Unexplained Price Reductions For purposes of this acquisition, the Government considers any type of price reduction that is unexplained, including any identified as a management challenge, to be unreasonable. An unexplained price reduction may adversely affect an Offeror’s proposal risk rating under the Management and Technical subfactors.

M-8.5 Unbalanced Pricing The Government may reject an offer as unacceptable if the price is materially unbalanced. Unbalanced pricing exists when, despite an acceptable total evaluated price, the price of one or more contract line items is significantly over or understated as indicated by the application of cost or price analysis techniques.