20161205_-_RFI_Response_JOC_W911S2-16-R-8001.pdf

RFI 01. JOC W911S2-16-R-8001-0001

12/5/2016

1. In response to # 19 Q&A in Addendum #1, providing a bond for the maximum value of $19.8 Million is an unreasonable request and I request you re-consider your response. I have had past term contracts and have current, JOC and IDIQ contracts and have never been required a performance bond for the possible “Maximum” contract price. It would make no sense to be required to provide a bond for work that may not be performed. Per far regulation 52.228-15 A, the definition for original contract price for IDIQ contracts is the price for the “minimum” quantity and not the maximum price. Please respond and advise of your intentions. Thank You!

ANSWER: The reference to 52-228.15(a) is a mistaken application, the correct reference is AFARS 5117.9004-2 (g) "Bonding must be sufficient to cover the stated estimated annual maximum contract value.... 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."

The amounts covered under the bond are justified by historical experience and anticipated workload. Total dollars obligated under the previous contract are noted in the bid schedule.

Unneeded bond premium reimbursement is a part of doing business as a JOC contractor, to the extent that language is included in the AFARS exemplifying it.