Five Seemingly Forbidden Practices You Can Use
They require more effort and thought, but they beat risk aversion.
By Will Roberts
I recently informally polled contracting colleagues to discover which practices they and others most commonly avoid. I used the assumption they are forbidden, even though they are not. Five stood out. Let’s examine each one to learn how it can, and should be, appropriately applied.
The Federal Acquisition Regulation (FAR) and its accompanying rules may seem straightforward. But behind every simple law there is a plethora of complex procedures and guides to enforce those rules. Sometimes unwritten rules reflect an office culture. Many make good business sense and create necessary guard rails. However, some rules, attitudes, procedures, and cultural norms are unnecessary. Some are even potentially harmful to the federal regulation they strive to enforce.
How do unnecessary prohibitions develop? Most are founded on the admirable desire to be prudent, diligent, and responsible. Contracting professionals are, after all, stewards of taxpayers’ dollars. Others spring up from the grassroots without policymaking or executive guidance. This is due to a lack of critical thinking or mission-focused perspective among contracting officers (COs) and contract specialists (CSs).
COs must exercise seemingly forbidden practices in a cautious and skillful way. Otherwise they violate principles of procurement law. But just because they require more effort and thought doesn’t mean it is better to revert to risk aversion.
Why not? Remember the vision stated in FAR 1.102(a): “to deliver on a timely basis the best value product or service to the customer.” Contracting officers must use their authority to determine the applicability of laws and regulations in order to meet this important vision (FAR 1.102-4(a)).
COs often will need to act creatively to meet the needs of their customers. Good COs are not rule-breaking rebels. They are skilled practitioners who know the law and navigate it to meet the mission and the vision of the Federal Acquisition System. At times, that will require challenging the instinct to play it safe.
In the spirit of empowering independent-minded contracting practitioners, consider these practices that can seem forbidden, but are not.
1. You Can Have Dinner With Contractors
Over the past decade, the Office of Management and Budget (OMB) released a series of “myth-busting” memos to correct common misunderstandings about engaging with industry. Many contracting professionals continue to maintain a cautious arms-length relationship with companies for fear that close communications will violate principles of fairness and propriety.
One-on-one engagements with companies appear to pose unacceptable risks. Even more unacceptable are one-on-one engagements conducted over informal events such as dinners. How can a CO break bread with a company representative without violating rules of fairness?
In its very first myth-busting memo, the OMB assures that one-on-one engagements are okay. That is, as long as government employees do not display preferential treatment toward a particular company. Preferential treatment constitutes engaging in meaningful discussions with some companies while denying similar access to others.
Let’s apply this one-on-one principle to informal dinners. Whether for business or with friends, dining with someone is a form of relationship building. Business lunches and dinners are effective means of getting to know one another in a less formal environment. And they can be incredibly effective in bridging the gap between government and industry.
Government employees obviously cannot engage in business transactions with companies over meals. Nor can they discuss terms and conditions that would provide an unfair competitive advantage in future competitions. But breaking bread together is a way of learning about the market, industry pain points, and even communicating general challenges facing government agencies. In other words, it can be a meaningful way for both industry and government to get to know one another.
How can you have dinner with a company representative and still prevent the appearance of impropriety or preferential treatment?
Former Secretary of Defense Gen. James Mattis created an internal office called “the machine” to filter all industry meeting requests. It helped him ensure that his interactions with industry did not create the appearance of unfair treatment. When he was invited to a dinner by a company, for example, his machine made sure he accepted other invitations from similar companies in similar markets.
In 2020, the Inspector General investigated apparent cases of unfair treatment surrounding the contentious $10 billion Joint Enterprise Defense Infrastructure (JEDI) cloud computing procurement. The IG report lauded the Mattis machine and noted how effective it was in allowing the Secretary to dine with companies without displaying preferential treatment.1
In the era of innovative commercial technologies, government officials increasingly need to build relationships with companies to build understanding of new industries and commercial capabilities. COs should not be hesitant to engage in meaningful forms of engagement. But they must be diligent in conducting them openly and fairly. Displaying fair treatment does not mean dining with every single company in a particular market. But it does require that you remain even-handed and seek relationships with a balanced range of companies.
2. You Can Reveal Funding Limits in Solicitations
Often, revealing a targeted price range will affect the natural flow of competition in the market. FAR Part 10.001 directs COs to study market rates in order to determine how particular products can meet government needs. In many cases, the acquisition team can prepare an independent cost estimate with confidence, thereby rendering any disclosure of targeted price ranges unnecessary.
Sometimes, however, disclosing an estimated price range or funding limits during a competition is the best way to obtain the best-value product. No law prohibits revealing this information during solicitation, as releasing the information does not give any particular company an unfair competitive advantage.
You still need to comply with the Competition in Contracting Act (CICA) and related rules that mandate competition to the maximum extent practicable. You must always make sure that releasing budgetary and pricing information does not dampen competition by shrinking some of the price evaluation differentiation.
However, if it makes good business sense to the CO and is in the best interest of the government, it is okay with the FAR. As with all of the practices mentioned in this article, CO discretion is needed to carefully balance government transparency with maximum competition.
Disclosure of price ranges can bring benefits when working with emerging technologies. Established market prices are not readily available through market research. It can be important to signal the market, “I have a range of $3 million to $5 million of affordability available for this effort. Here is my statement of objectives (SOO). Who can provide the most innovative and timely solution within this funding range?”
Doing so shifts the government’s main source selection priority away from cost and toward schedule and performance. The CO must still make a fair price determination. He or she also must use price as a primary basis for award, but disclosing affordability ranges often leads to more accurate solutions from vendors. They know the limits and can work creatively within them to provide the best-value option.
3. You Can Combine Different Source Selection Procedures
There is a misperception in many contracting offices that selecting a particular source selection strategy means strictly and solely adhering to the rules and procedures related to that strategy. Sometimes, this mentality comes from very meticulous procedures for competitive strategies.
For example, offices may provide specific guidelines and standard operating procedures (SOPs) for conducting lowest-priced, technically acceptable (LPTA) source selections. Similarly, best-value tradeoff selections require following the source selection guide and tradeoff procedures. Merging two paths may seem confusing and could rankle a policy reviewer.
Can SOPs be combined?
The truth is that combining source selection procedures can be very easy and very effective. The FAR even encourages it. For example, FAR 6.102(c) states: “If sealed bids are not appropriate, contracting officers may use a combination of competitive procedures.”
Selection approaches can and should be tailored for each requirement. This generates the best responses from industry and incentivizes innovation. The key is for the CO to maximize the balance between procurement speed, and efficiency, and fair competition.
A CO could determine, for example, that it is best to use a tradeoff approach for Phase 1 of a source selection. The goal would be to home in on the offerors most capable of meeting the requirements. Then, within the resulting competitive range of most technically proficient offerors, the CO could move to a sealed bid approach using the lowest price. The winner would be announced in an open forum.
The most important consideration is to not adhere to local SOPs. Instead, clearly communicate your strategy in your request for proposals. Clarity to offerors about the specific competitive procedure and strict adherence to those procedures during evaluation and selection establish fairness, openness, and prudence.
4. You Can Go Against the Advice of Your Legal Counsel
Legal advisors are called advisers for a reason. Ultimately, the CO is accountable for contract decisions. When protests are deliberated, the courts and panels focus on the actions of the CO, not the legal counsel. With such a large responsibility, the acquisition team must trust and empower the CO.
Of course, legal reviews are integral to any contracting office. Contracting officers must seek them to ensure legal sufficiency of their documentation and actions. Lawyers represent and protect COs. In turn, COs should trust and respect the advice of their legal teammates.
However, contracting officers and attorneys often disagree about how to execute certain contract actions and appropriate levels of risk. Lawyers serve an important role but have different objectives and are typically risk averse. COs should be mission-focused and prioritize the timely delivery of a best-value product to the customer. As a result, COs may be willing to accept more risk than lawyers for particular contractual actions. The application of rules to best meet the needs of the customer should be at the discretion of the contracting officers, with lawyers serving as advisers.
The FAR states very clearly as a guiding principle in FAR 1.102-4(a): “The contracting officer must have the authority to the maximum extent practicable and consistent with law, to determine the application of rules, regulations, and policies, on a specific contract.”
Contracting offices and acquisition teams must maintain a culture of trusting COs and empowering them to act with sound business judgment. A general counsel refusing to sign a legal review unless the CO alters course reflects an unhealthy lack of trust. When this occurs, contracting leaders should seek the root causes of this distrust.
Are COs sufficiently trained? Have hiring officials selected skillful professionals that can prudently wield unlimited warrants? If not, empowerment and workforce development are lacking in violation of the FAR’s guiding principles.
Prioritizing knowledge and growing skills produces sound decision-makers. They can call the plays and rely on legal counsel as advisers, not obstacles.
5. You Can Move Fast Using the FAR
Some forward-thinking procurement professionals are creating artificial barriers to using the FAR. Some contracting offices and COs rely on the flexibilities offered by other transaction authority (OTA) or vehicles such as partnership intermediary agreements (PIAs). They stigmatize the FAR as useless in providing timely delivery of a product.
The FAR still has a place, and COs can use it swiftly and effectively. However contracting professionals should be encouraged not to impose FAR requirements that over regulate the flexibilities offered by other transactions (OTs) and other acquisition innovations. Increasingly, innovation-minded COs are teaching colleagues how not to introduce unnecessary FAR principles in non-FAR vehicles.
Remember, another guiding principle stated in FAR 1.102(d) is to “exercise personal initiative and sound business judgment in providing the best value product or service to meet the customer’s needs. In exercising initiative, government members of the acquisition team may assume if a specific strategy, practice, policy, or procedure is in the best interests of the government and is not addressed in the FAR, nor prohibited by law, executive order, or other regulation, that the strategy, practice, policy, or procedure is a permissible exercise of authority.”
The more you know about the FAR, the more you can use it to move fast. Many offices use the FAR to award lightning-fast contracts even more quickly than OTs. Sometimes it’s not about the tool, but the tool’s user.
As a CO, you must be intimately familiar with all the tools in your toolbelt. Like a skilled handyman, you can then assess the situation and grab the best tool without even looking. No tool is forbidden.
Conclusion
COs must exercise caution, diligence, and skill. To practice seemingly forbidden acts for the benefit of the customer is to act as a contracting ninja.
Good COs do not challenge rules out of laziness or revolt. They are not embittered toward the FAR and purposely cut corners as a result. They do not begrudge leadership, general counsel, or policy reviewers. On the contrary, they continuously seek more effective ways to satisfy the customer in terms of cost, performance, and time.
Sometimes, that requires challenging assumptions about what is and is not forbidden and encouraging others to do so as well. CM
Will Roberts is Director of Acquisition Solutions for ASI Government and runs the ASI Education Channel. He is an attorney and member of the Florida Bar with over 15 years of experience in federal contracting, most recently as the Acquisition chief of DoD artificial intelligence (AI) agencies. Special thanks to “Clause Corner” column author Irvin Gray for providing input for this article. This article is based on a video by ASI Government on its new YouTube channel ASI Education, which is equal parts entertainment and education. Check it out at https://www.youtube.com/@asi.education.
ENDNOTE
Report on the Joint Enterprise Defense Infrastructure (JEDI) Cloud Procurement, DoD Inspector General, 13 April 2020, https://www.dodig.mil/Reports/Administrative-Investigations/Article/2150471/report-on-the-joint-enterprise-defense-infrastructure-jedi-cloud-procurement-do/