The auditors are taking exception to the Contracting Officer contacting Contractors A and B and asking for pricing options and awarding them Regions 2, 3, and 6. They believe this violates the FAR prohibition on Sole Source Contracting or, at a minimum, shows the lack of competition. However, I believe the actions on the part of the Contracting Officer were appropriate given there had been no proposals received in response to the RFP for these Regions. There is nothing to suggest that issuing a new RFP would suddenly result in proposals for these Regions or new companies competing. However, I can't find anything in the FAR to support the actions taken by the Contracting Officer related to Regions 2, 3, and 6 to satisfy the auditors that the Contracting Officer did not behave inappropriately. Can you point me in the right direction? Where should I look in the FAR to support the actions taken by the Contracting Officer?
The statutorily directed (e.g., see 10 U.S.C. 2301-2337 and 41 U.S.C. 253) preference for the promotion and provision for “full and open competition” in soliciting offers and awarding Government contracts is not implemented in just one Part or Section of the Federal Acquisition Regulation (FAR) but rather in several different places in the FAR. These several FAR sections also correspond to the several stages or phases of the procurement process. In other words, to demonstrate compliance you might need to exam and evaluate compliance with several portions of the FAR (presuming that compliance is equal to “did not behave inappropriately”).
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A non-exhaustive summary of FAR competition related portions are outlined in brief directly below.
Market Research – FAR Part 10 FAR Part 10 requires agencies to “conduct market research appropriate to the circumstances” (§10.001(a)(2)) and to “use the results of market research to determine if sources capable of satisfying the agency’s requirements exists” (§10.001(a)(3)).
Describing Agency Needs – FAR Part 11 FAR Part 11 requires that agencies “specify needs using market research in a manner designated to – (i) Promote full and open competition” (FAR §11.002(a)(1)).
Publicizing Contract Actions – FAR Part 5 FAR Part 5 requires the agencies to publicize proposed contract actions “in order to – (a) Increase competition; (b) Broaden industry participation in meeting Government requirements; Assist small business concerns, . . . , in obtaining contracts and subcontracts.” FAR §5.002. When read in conjunction with FAR §12.603, FAR §5.203(b), requires the “contracting officer to establish a solicitation response time that will afford potential offerors a reasonable opportunity to respond” to publicized solicitations
Competition Requirements – FAR Part 6 FAR Part 6 requires the promotion of full and open competition (FAR §6.101) and identifies a list of four competitive procedures that might be used: (a) Sealed bids; (b) Competitive proposals; (c ) Combination of competitive procedures; and (d) Other competitive procedures. (see FAR §6.102)
With limited exceptions, contracting officers are to promote and provide for full and open competition in soliciting offers and awarding Government contracts (e.g., see FAR § 6.101.). Further FAR requires a finding that conditions for stated exceptions to full and open competition be found before proceeding to limit competition (FAR §6.303).
Because the FAR requirements cited are primarily procedural albeit designed to encourage competition opportunities, it is certainly within the realm of reasonable possibility that the contracting officer might diligently perform the FAR required procedures, and yet not obtain numerous offers for a given requirement.
More specifically to the facts here, if the contracting officer could demonstrate regulatory and policy compliance at all the various stages of the procurement (i.e., market research, planning, source selection, etc.) at issue, the low number of offers received (only one offer for three requirements and no offers for the other three requirements) may not be attributable to inappropriate behavior, but rather to other market forces or outcome of less informed judgment. The low number of offers received may actually be relevant evidence for justification for use of one or more of the seven exceptions to full and open competition at FAR §6.302-1 through §6.302-7. Contracting without providing for full and open competition or full and open competition after exclusion of sources is a violation of statute, unless permitted by one of the exceptions in §6.302 (see FAR §6.301). Where one of the exceptions is present and needs to be invoked, FAR §6.303 requires written reasoned justification before invoking the exceptions contained in §6.302.
In conclusion, here consideration should be given to compliance with the applicable competition related regulatory requirements at each of the stages of procurement. Then to the necessity of documenting the justification for limiting award to only Contractor A and B, given the current information available, especially for the proposed contract actions that previously did not yield offers (Regions 2, 3, and 6).