Start Date

4-1986 8:00 AM

Description

With the ongoing emphasis or thrust, if you will, within the Government being placed on contracting out, under 0MB Circular A-7b, the types of contractual instruments employed become more of a focus for our attention than ever before. Consequently, the contracting structure used by the Government in the management of Government-owned, Contractor-operated facilities (GOCO) needs to be re-examined in this light. Objectives to be considered are lowering costs, increasing flexibility, and maintaining ease of transition between the various phases of the contracting process. New contract types must be designed and utilized to meet changing conditions and requirements. Federal Acquisition Regulations need to be revised to accommodate new contracting techniques. The use of the Cost Plus Award Fee contracts with subjective evaluation at GOCO-type facilities needs to be reviewed. The use of Fixed Price contracts will be discussed, and the pros and cons of their use in this environment will be discussed by the author in depth. Two new contract types which the author has devised will then be presented. Future contract types will evolve as needs arise.

The first contract type proposed is the Cost Plus Award Fee (Objective) contract. This contract provides for development of objective criteria that are definitive and not subjective in nature.

The second type of contract is the Fixed Price Award Incentive contract which lends itself well for application as a management contract in GOCO operations. This contract type provides wider latitude in the management of the operations of a COCO or maintenance-type operation when the volume and type of work cannot be definitively specified during the initial phases of the process. This type of contract precludes the Government from active involvement in many adjustments to the cost/profit/fee base during a contract performance period.

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Apr 1st, 8:00 AM

Two New Contract Types for Operation of Government-Owned Facilities

With the ongoing emphasis or thrust, if you will, within the Government being placed on contracting out, under 0MB Circular A-7b, the types of contractual instruments employed become more of a focus for our attention than ever before. Consequently, the contracting structure used by the Government in the management of Government-owned, Contractor-operated facilities (GOCO) needs to be re-examined in this light. Objectives to be considered are lowering costs, increasing flexibility, and maintaining ease of transition between the various phases of the contracting process. New contract types must be designed and utilized to meet changing conditions and requirements. Federal Acquisition Regulations need to be revised to accommodate new contracting techniques. The use of the Cost Plus Award Fee contracts with subjective evaluation at GOCO-type facilities needs to be reviewed. The use of Fixed Price contracts will be discussed, and the pros and cons of their use in this environment will be discussed by the author in depth. Two new contract types which the author has devised will then be presented. Future contract types will evolve as needs arise.

The first contract type proposed is the Cost Plus Award Fee (Objective) contract. This contract provides for development of objective criteria that are definitive and not subjective in nature.

The second type of contract is the Fixed Price Award Incentive contract which lends itself well for application as a management contract in GOCO operations. This contract type provides wider latitude in the management of the operations of a COCO or maintenance-type operation when the volume and type of work cannot be definitively specified during the initial phases of the process. This type of contract precludes the Government from active involvement in many adjustments to the cost/profit/fee base during a contract performance period.

 

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