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  • Question

    When a oral RFP is conducted for a emergency construction services is the bacon wages automatically assumed in the oral RFP or do we need to hand deliver the bacon wages?


    Answer

    In order to answer the questions, a few FAR references are provided in 1 -5
    below.
     
    Typically, contracts or purchase orders issued as a result of "emergency"
    situations are award as a result of "unusual and compelling" circumstances
    and are awarded as undefinitized contractual actions or unpriced purchase
    orders. These undefinitized actions are used because one or more terms and
    conditions of the contract, including price,  are unknown at the time of award.
    However, the necessity to allow the contractor to perform immediately is so urgent
    that the Government is willing to accept the increased cost risk.
     
    In the situation encountered, the problem is more difficult since a purchase
    order was awarded as a result of the emergency situation.  Purchase orders
    by FAR definition are not binding contracts unless actions in FAR  13.302-3 are
    taken.
     
    Davis Bacon wage determinations are not automatically assumed to be included
    in "oral RFPs" as there are unknowns that will affect the contractor
    pricing. The unknowns include the prevailing wage rates that the Government will
    require the contractor to pay employees. Without a copy of the Department of
    Labor wage determination, a contractor cannot realistically provide a firm
    fixed price proposal to the Government. Therefore, you have at least two
    choices: award an undefinitized contractual action or unpriced purchase
    order or provide the contractor with all the information including wage
    rates that requires compliance. Inclusion of the Davis Bacon wage rates is a
    contracting officer responsibility.
       
    References:
    1) FAR 2.101 Definitions: "Purchase order," when issued by the Government,
    means an offer by the Government to buy supplies or services, including
    construction and research and development, upon specified terms and
    conditions, using simplified acquisition procedures
     
    2) FAR 22.403-1 -- Davis-Bacon Act.
    The Davis-Bacon Act (40 U.S.C. 3141 et seq.) provides that contracts in
    excess of $2,000 to which the United States or the District of Columbia is a party
    for construction, alteration, or repair (including painting and decorating)
    of public buildings or public works within the United States, shall contain a
    clause (see 52.222-6) that no laborer or mechanic employed directly upon the
    site of the work shall receive less than the prevailing wage rates as
    determined by the Secretary of Labor.
     
    3) FAR 13.302-2 -- Unpriced Purchase Orders.
    (a) An unpriced purchase order is an order for supplies or services, the
    price of which is not established at the time of issuance of the order.
     
    (b) An unpriced purchase order may be used only when --
     
    (1) It is impractical to obtain pricing in advance of issuance of the
    purchase order; and
     
    (2) The purchase is for --
     
    (i) Repairs to equipment requiring disassembly to determine the nature and
    extent of repairs;
     
    (ii) Material available from only one source and for which cost cannot
    readily be established; or
     
    (iii) Supplies or services for which prices are known to be competitive, but
    exact prices are not known (e.g., miscellaneous repair parts, maintenance
    agreements).
     
    (c) Unpriced purchase orders may be issued on paper or electronically. A
    realistic monetary limitation, either for each line item or for the total
    order, shall be placed on each unpriced purchase order. The monetary
    limitation shall be an obligation subject to adjustment when the firm price
    is established. The contracting office shall follow up on each order to ensure
    timely pricing. The contracting officer or the contracting officer's
    designated representative shall review the invoice price and, if reasonable
    (see 13.106-3(a)), process the invoice for payment.
     
    4) FAR 13.302-3 -- Obtaining Contractor Acceptance and Modifying Purchase
    Orders.
    (a) When it is desired to consummate a binding contract between the parties
    before the contractor undertakes performance, the contracting officer shall
    require written (see 2.101) acceptance of the purchase order by the
    contractor.
     
    5) DFARS 217.74(d) " Undefinitized  contract action" means any contract
    action for which the contract terms, specifications, or price are not agreed upon
    before performance is begun under the action.
     
     

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