On the "Today's News" page, the FAR Councils issued guidelines for use by contracting officers when they make a business judgment to determine responsibility of an offeror in regard to "Satisfactory Record of Integrity and Business Ethics." The FAR Councils say that this change was necessary because contracting officers need guidance to determine what comprises a lack of "integrity and business ethics." In regard to the previous lack of guidance the Councils say, "This lack of guidance has an unfortunate consequence: Contracting officers are extremely reluctant, absent clear guidance, to exercise their discretion in making this determination."

Are contracting officers reluctant to make a business judgment in a responsibility determination? If so, why?

Do potential contractors feel better or worse now that there is specific guidance?

By joel hoffman on Wednesday, December 20, 2000 - 08:06 am:

Bob, my KO's have been extremely reluctant to make non-responsibility determinations for several reasons, based on track records. 1) lack of enough hard documentation to strongly support Construction Division's complaints about past performance 2) the fact that any non-responsibility determinations for small businesses go to the SBA, usually resulting in SBA granting Certificates of Competency and 3) a likely protest from large business. It usually isn't worth the hassle - especially when we need to start work ASAP. Happy Sails! joel

By Nick Sanders on Wednesday, December 20, 2000 - 10:35 am:

Just thought I'd mention that, from my Contractor perspective, another worrisome aspect of this new regulation is the change to FAR 31.205-47, now making unallowable costs associated with administrative proceedings where a Contractor is found to have violated a regulation.

What, exactly, is the definition of a "proceeding" and does this change mean that costs of fighting a CAS noncompliance are now unallowable? Does this mean that the costs of arguing a position before the NLRB are now unallowable if the NLRB finds against the owner on an administrative technicality?

I'm afraid that's a real possibility...

Happy holidays.

By Eric Ottinger on Wednesday, December 20, 2000 - 03:40 pm:

Bob,

Keeping in mind that his public forum is not a good place to disagree with higher management--

Higher management frequently assumes that the government left hand knows what the government right hand is doing. Working level troops know better.

Complexity increases geometrically with the number of locations and the number of participants. At some point, the complexity becomes unmanageable.

Much of this will require coordination with other agencies, each with their own agenda, and none with any particular interest in getting your requirement on contract.

Although the contracting officer makes the decision and takes the guff, this is the type of issue where General Counsel and higher management in the agency will have the largest voice. As much as we love them, we aren’t looking for an opportunity to spend more quality time with General Counsel.

Nobody is proposing to hire more 1102’s to deal with this additional workload.

As much as we know that perfection is impossible, inconsistency offends our basic sense of fairness.

Much depends on the implementation. And, there is much weight to the argument that we have many scofflaw contractors who frequently behave very badly but not quite badly enough to be debarred.

Overall, we like things to be black and white and this will get us into a lot of gray.

Eric

By joel hoffman on Wednesday, December 20, 2000 - 07:28 pm:

Eric, I pretty much agree with you.

It would appear that the typical KO must rely on the Offeror to certify that they aren't scouflaws or to self-incriminate themselves, unless there is word of mouth or common knowledge of some highly publicized, egregious act by the offeror... HA Ha.

This new rule might occasionally catch a notorious scoundrel. Happy Sails!

By joel hoffman on Thursday, December 21, 2000 - 07:32 am:

After reading about the controversy in last night's paper, I thought about this a bit more. It would seem that there needs to be a central clearinghouse for a KO to check the status of any apparent successful bidder/offeror. 30,000 Contracting Officers shouldn't have to reinvent the wheel every time there is a responsibility determination. I suggest the office that manages the debarment listings be utilized and expanded, if necessary.

Also, let's see how "non-responsible" an apparent successful offeror is, when there is a wide gap in bids/best value, only source or other critical criteria? How long can the standard of consistency last? Can there be any consistency across the Government. We respondents can't even agree, much of the time!

By Eric Ottinger on Thursday, December 21, 2000 - 09:13 am:

Joel and All,

I saw Dave Drabkin speak at an NCMA meeting a couple months back. He was asked about the "balcklisting" rule. Dave prudently declined to discuss this issue. It is very, very sensitive.

Yes, it implies that somebody is going to keep a comprehensive list of who has been naughty and nice. That raises all kinds of issues.

One of the admirable things about the 1102 community is that we are good troops and we take orders. We will implement the direction that we are given to the best of our ability.

On the other hand, various agencies (I won't name them) have a habit of going their own way and doing their own thing. It will be very hard to get consistency.

The wise heads say that the big contractors are all about the same. They have all done something "Oh my gosh, I don't believe they did that" on occasion, but we can't really debar any of them. We need them too much. (This is a problem with Past Performance as well. With the big guys it all works out to about the same mixed bag.)

All I can say is that it will be interesting.

Eric

By Anonymous on Thursday, December 21, 2000 - 10:18 am:

Eric, Regarding the "big contractors", I would not say it's true in every case that "we can't do without them."

I found in a certain nameless program that "the firms can't do without the Government." It seems that some of them will do anything and everything to influence selections, to obtain special treatment, bully the program managers and Contracting Officers not to clamp down on poor performance, go to the Pentagon and above to put a "spin" on a situation, etc.

I know of a couple of other firms which could execute these contracts better than the incumbents. The other firms certainly have better business ehtics than the thugs in the particular program.

I believe there is a pre-determined mentality that only certain supercontractors can handle certain programs. Actually, we just package the work into super-contracts for convenience or to assure them business.

Unfortunately, I must officially remain anonymous.

By Kennedy How on Thursday, December 21, 2000 - 10:58 am:

I agree with Joel's first post, because absent something concrete that a CO can hang his decision on, the affected contractor will always cry "Arbitrary and Capricious", or, that hasn't been proven yet. I'm more of the mind that you need to be proven guilty first, before tarring a contractor.

My personal experience in this area pretty much mirrors that. And, I often wonder, when a source-selection activity calls me and asks about a contractor of mine, and the fact of the matter is that he's being investigated for fraud, but after the source-selection is done, the contractor has been found innocent, how much that actual investigation information played a part in the final decision of the source-selection authority.

Kennedy

By Eric Ottinger on Thursday, December 21, 2000 - 12:10 pm:

Anon,

Thanks for participating. Kudos to Bob for the Anonymous option. It will liven up the discussion.

All generalizations are false, including mine. I was thinking of the really major defense contractors. If I wish to acquire a certain weapons system in a reasonable time frame, there is only one way to go.

Managers are always going to want continuity and they are always going to prefer to have a single "button" to push. It is our job to oppose these tendencies, but not to the point where we actually do harm to our customers.

Kennedy,

I think we are expected to consider actual convictions. We should consider all of our contractors to be innocent until proven guilty.

Of course, all of the guilty are going to tell you that they are now reformed, and the offense was really very technical, and they love the environment (or whatever) just as much as anybody, and everbody does it, and they don't know why they were singled out, and you don't want to throw all of those good loyal workers out of work, etc. etc.

Generally, I consider it a mark of professionalism that I will be courteous and fair to everyone, even when I know that some are boy scouts and others are sleazeballs (and a few are lovable rogues). Normally, my private thoughts shouldn't affect my public behavior.

Suffice that this will make life more complicated.

Eric

By Anon2 on Thursday, December 21, 2000 - 12:18 pm:

Anonymous, among the big defense contractors of a decade or so ago one was often mentioned as a hoped for bidder. The reason was competence combined with a strong reputation for honesty. That was not the case with almost all the others. Some were almost always mentioned in terms of problems. During the consolidation of defense contractors it sometimes seemed the greater problems grew at the expense of the lessre problems. The one mentioned was is long gone. Went in about the second round of consolidation.

By djdyer on Thursday, December 21, 2000 - 10:27 am:

After reading FAC 97-21, (clarifying what a satisfactory record of integrity and business ethics is) I thought: How can a contracting officer make an affirmative determination as to whether a contractor has ever been convicted of a felony?

Am I required to do some sort of criminal background investigation to make an "affirmative determination"?

If I am, how? Any suggestions?