DRAFT Solicitation HR0011-11-R-0003 Attachment 2 Award Fee Plan 04-08-11.doc

Attachment 2

Solicitation No. HR0011-11-R-0003

April 8, 2011

AWARD FEE PLAN

For

Contractor Support Services for the Security and Intelligence Directorate of DARPA Date Approved: TBD Approved By: Fee Determination Official A.

INTRODUCTION

1.

This plan covers the administration for the award fee provisions of the contract for: Contractor Support Services for the Security and Intelligence Directorate of DARPA. It describes specific criteria and procedures used to assess the contractor’s performance and to determine the amount of award fee earned. Actual award-fee determinations and the methodology for determining award fee are unilateral decisions made solely at the discretion of the Government. The Fee Determining Official (FDO) may unilaterally change this plan prior to the beginning of an evaluation period. The contractor will be notified of changes to the plan by the Contracting Officer, in writing, before the start of the affected evaluation period. Changes affecting the current evaluation period must be by mutual agreement of both parties.

Contract No. To Be Determined (TBD)

With: TBD

2.

This document outlines the process for evaluating adherence with the Statement of Work (SOW) and identifies how award fee under the contract will be apportioned. Evaluation management will be accomplished through a four-step approach, which will measure, examine, correct and continually improve the services provided by the Contractor. The following outlines each step of the SOW management process. These steps will be implemented immediately upon contract award.

Step 1: Measure, Gather & Report Data for relevant SOW tasks Meet SOW Standard of performance as stated in SOW

Meet SOW mandated deadlines/standards

Step 2: Examine Results Program effectiveness to include

a. Adverse impacts on programs

b. Initiatives that improve program effectiveness

Step 3: Recommend Corrective Action Identification of non-conformance to SOW

Creation of Corrective Action Plan

Step 4: Continuous Improvement Implementation/Effectiveness of Improvements

Implementation/Effectiveness of Corrective Action Plan

By implementing this process, DARPA will institutionalize a problem-solving organizational structure, and encourage a pervasive mindset of continuous improvement. The entire process will be repeated in an iterative cycle, which may generate new standards, requirements, or changes to existing ones, while maintaining the ultimate goal of mirroring DARPA’s management philosophy.

The Government reserves the right to engage independent contractors to monitor, investigate and evaluate contractor performance. The government, or its designees, will conduct periodic, unannounced audits in support of the data gathering process.

B.

ORGANIZATIONAL STRUCTURE FOR AWARD FEE ADMINISTRATION

The following organizational structure is established for administering the award fee provisions of the contract. Note that this structure is subject to change at the discretion of the Government.

1.

Fee Determination Official (FDO) a.

The FDO is the Director of TBD, Defense Advanced Research Projects Agency (DARPA). The FDO reserves the right to consult advisors in addition to those named in this document without notifying the contractor.

b.

Primary FDO responsibilities are:

(1) Determining the award fee earned and payable for each evaluation period.

(2) Approving the Award Fee Plan and any significant changes.

2.

Award Fee Board (AFB) a.

The Award Fee Board is made up of the following members:

Chairperson - Director, Security and Intelligence Directorate, and

· Assistant Director, Program Management (ADPM) for TBD,

· Contracting Officer (CO),

· Primary or Alternate Contracting Officer Representative (COR), and

Non-voting advisor: Legal,

· Non-voting Award Fee Coordinator b.

Primary Award Fee Board Members’ Responsibilities are:

(1) Evaluate contractor performance based on recommendations provided by Subject Matter Experts (SMEs) and other personnel, as appropriate.

(2) Make earned award fee recommendations to be presented to FDO

(3) May also recommend changes to the Award Fee Plan.

3.

Subject Matter Experts (SMEs) a.

Subject Matter Experts will be assigned to report to the Award Fee Board on the contractor’s compliance with the SOW tasks and the established performance standards during the period. SME assignments may be changed at any time without notice to the contractor. The Government reserves the right to consult independent contractors to assist and conduct performance evaluation.

b.

Primary SME performance monitoring responsibilities are:

(1) Monitoring, evaluating and assessing contractor performance in assigned areas.

(a) SMEs will conduct all assessments in an open, objective and cooperative spirit so that a fair and accurate evaluation is obtained. This will enhance contractor receipt of information from which to plan improvements in performance. Positive performance accomplishments should be emphasized just as readily as negative ones.

(b) SMEs will discuss the results with the Government COR and Award Fee Coordinator (AFC), as appropriate, noting any observed deficiencies and/or accompanying recommendations.

(c) SMEs will avoid any activity or association which might cause, or give the appearance of causing, a conflict of interest.

(d) SME discussions with contractor personnel are not to be used to instruct, to direct, to supervise, or as an attempt to control these personnel in the performance of the contract. The role of the SME is to monitor, assess, and evaluate, not to manage the contractor's effort.

(2) Periodically SMEs will be prepared to make verbal reports as required by the AFB or

FDO.

(3) Recommending to the FDO, through the COR, appropriate changes in this plan for consideration.

4.

Award Fee Coordinator (AFC) a.

The AFC may also be the Primary or Alternate Contracting Officer's Representative (COR).

b.

The AFC is the DARPA official who handles administrative actions required by the AFB and FDO in order to assure smooth operation of the Award Fee Plan and that the overall evaluation process is conducted in accordance with current DARPA policies and practices. These AFC duties include:

(1) Assuring SME evaluation reports and contractor self-evaluations are provided on time and are made available to the AFB and FDO,

(2) Coordinating and arranging the AFB meetings,

(3) Taking notes during AFB meetings and preparing the AFB’s recommendation reports,

(4) Preparing the FDO’s official correspondence on the fee determination to the contractor's general management, and

(5) Coordinating the development of and changes to the Award Fee Plan.

c.

The AFC will assure that each SME receives the following:

(1) A copy of the contract and all modifications.

(2) A copy of this plan along with any subsequent changes thereto.

(3) Appropriate orientation and guidance.

(4) Specific instructions applicable to SME-assigned performance areas.

d.

The AFC shall provide to the Contractor information pertaining to adverse items or areas of poor performance to afford the Contractor an opportunity to clarify possible misunderstandings and to correct or resolve deficiencies.

C.

METHOD FOR DETERMINING AWARD FEE

A determination of the award fee earned for each evaluation period will be made by the FDO after the end of the period. The method to be followed in monitoring, evaluating, and assessing contractor performance during the period, as well as for determining the award fee earned, is described below.

1.

SMEs will monitor, evaluate, and assess contractor performance.

2.

SMEs provide Performance Evaluation Reports assessing the contractor’s performance to the COR and AFC. The written reports shall be briefed to the COR.

3. SMEs provide verbal presentations to the AFB or FDO, as requested.

4.

As appropriate, the AFB or FDO may request and obtain performance information from other units or personnel normally involved in observing contractor performance.

5.

The contractor will conduct and submit a self-evaluation to the AFC and FDO or their designated representative, 15 days after the end of a period.

6.

Approximately 21 days after the end of a period, the COR or his/her designee will meet with the contractor and discuss preliminary findings and recommendations. As requested by the COR, SMEs and other personnel involved in performance evaluation will attend the meeting and participate in discussions. At this meeting, the contractor will be given an opportunity to submit or respond to any additional matters.

7.

Approximately 30 days after the end of the evaluation period, the AFC will convene the AFB to discuss the award fee with the Board Members and other personnel, as appropriate. At the request of the FDO, the contractor may present its self-evaluation to the AFB. The AFB and FDO will consider the contractor’s self evaluation, information from the SMEs, and other performance information identified in paragraph 3 when making a recommendation to the FDO for the contractor’s earned award fee. If requested by the FDO, other personnel involved in performance evaluations may be required to attend the meeting. The Board will issue an Award Fee Recommendation Report to the FDO.

8.

The FDO, in coordination with the Contracting Officer, will determine the amount of award fee earned during the period within the guidelines specified herein. The FDO’s determination of the amount of award fee earned and the basis for this determination will be stated in the Award Fee Determination Report (AFDR). The report will be signed by the FDO and forwarded to the Contracting Officer to be provided to the Contractor for attachment to its voucher requesting payment of the award fee.

D.

AWARD FEE EVALUATION CATEGORIES & CRITERIA

1.

Categories of Performance and Weights The award fee evaluation areas and their respective weights are shown below:

Weight’s

OVERALL

WEIGHTS

Overall TBD %

TBD

TBD

TBD

TBD

TBD

TBD

Overall TBD %

TBD

TBD

TBD

TBD

Overall TBD %

TBD

TBD

TBD

TBD

Total Weight

100%

2.

Evaluation Criteria The evaluation categories and criteria are intended to cover all tasks and subtasks in the Statement of Work. A subtask will be considered to have met the standard in an evaluation period if no work under that subtask was assigned and/or performed.

The following evaluation criteria and their applicable weights within the SOW Subtasks will be used in measuring the standard of performance.

Evaluation Criteria

For SOW Section TBD

Weight

Assess the contractor’s conformance to contract requirements. Assess the accuracy of reports as well as technical excellence.

TBD %

Assess the timeliness of the contractor against the completion of administrative requirements, etc. Assess the contractor’s adherence to the delivery of work products, by assessing the contractor’s efforts during the assessment period that contribute to or effect schedules. Also consider: is the contractor reliable and responsive to direction?

TBD %

Assess the timeliness, completeness, and quality of problem identification, corrective action plans, reasonable and cooperative behavior. The extent to which the contractor discharges its responsibility for integration and coordination needed to execute the contract. Responsiveness to requirements, professional correspondence and administration, prompt notification of problems, flexibility, cooperativeness, and proactive solutions.

TBD %

Assess the contractor’s performance in selecting, retaining, supporting, and replacing (when necessary) key personnel.

TBD %

Assess the contractor’s effectiveness in forecasting, managing, and controlling contract cost. Also consider: was the work performed within budget?; were billings current, accurate, and complete?; cost effectiveness; and change orders issued.

TBD %

3.

Standards of Performance These standards of performance or performance grades will be used, in conjunction with the categories of performance, weights, and evaluation criteria, in determining whether and to what extent the Contractor has earned or may be entitled to receive any award fee.

a.

Exceptional performance – Performance meets contract requirements and significantly exceeds contract requirements to the Government’s benefit. The contractual performance of the element or sub-element being assessed was accomplished with few minor problems for which corrective actions taken by the contractor were highly effective.

b.

Very Good performance – Performance meets contractual requirements and exceeds some to the Government’s benefit. The contractual performance of the element or sub-element being assessed was accomplished with some minor problems for which corrective actions taken by the contractor were effective.

c. Satisfactory performance – Performance meets contractual requirements. The contractual performance of the element or sub-element contains some minor problems for which proposed corrective actions taken by the contractor appear satisfactory, or completed corrective actions were satisfactory.

d.

Marginal performance – Performance does not meet some contractual requirements. The contractual performance of the element or sub-element being assessed reflects a serious problem for which the contractor has submitted minimal corrective actions, if any. The contractor’s proposed actions appear only marginally effective or were not fully implemented.

e.

Unsatisfactory performance – Performance does not meet contractual requirements and recovery is not likely in a timely or cost effective manner. The contractual performance of the element or sub-element contains serious problem(s) for which the contractor’s corrective actions appear or were ineffective.

f.

Performance grades will be converted to percentages of award fee, rounded up to the nearest whole number, and payable as follows:

E.

CHANGES IN PLAN COVERAGE

1.

Right to Make Unilateral Changes Any matters covered in this plan not otherwise requiring mutual agreement under the contract, may be changed via a unilateral contract modification by the Contracting Officer. The changes will be made before the start of the applicable evaluation period.

2.

Method for Changing Plan Coverage a.

Personnel involved in the administration of the award fee provisions of the contract are encouraged to recommend changes in plan coverage with a view toward changing management emphasis, motivating higher performance levels, or improving the award fee determination process. Recommended changes should be sent to the AFC for consideration and drafting.

b.

Prior to the end of each evaluation period, the AFC will submit changes applicable to the next evaluation period for approval by the FDO with appropriate comments and justification, or inform the FDO that no changes are recommended for the next period.

c.

The FDO will notify the Contracting Officer before the beginning of the next evaluation period what changes, if any, are to be applied and the Contracting Officer will make the changes via a unilateral contract modification as stated in paragraph one above. If the contractor is not provided with this modification before the beginning of the next period, the existing plan coverage will continue in effect for the next evaluation period. The changes may be provided by facsimile.

F.

CONTRACT TERMINATION

If the contract is terminated for the convenience of the Government after the start of an award-fee evaluation period, the award fee deemed earned for that period shall be determined by the FDO using the normal award-fee evaluation process on a prorated basis. After termination for convenience, the remaining award-fee amounts allocated to all subsequent award-fee evaluation periods cannot be earned by the contractor and, therefore, shall not be paid.

G.

AWARD FEE ALLOCATION BY EVALUATION PERIODS

The award fee earned by the contractor will be determined at the completion of evaluation periods shown below. The dollars shown corresponding to each period is the maximum available-award-fee amount that can be earned during that particular period.

Base Effort

First

Second

Third

Fourth

Option 1 Effort

First

Second

Third

Fourth

Option 2 Effort

First

Second

Third

Option 3 Effort

First

Second

Third

Option 4 Effort

First

Second

Third

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