DFRC 2005 Procurement Survey

The NASA Headquarters Office of Procurement conducted this Procurement Management Survey at Dryden Flight Research Center (DFRC) under the authority of NASA Handbook 1101.3, The NASA Organization. The survey was conducted from December 5 through December 9, 2005. The report contains the survey findings, including strengths, weaknesses, and considerations.

On December 9, 2005, Tom Luedtke, Assistant Administrator for Procurement, and the survey team held an exit briefing with the senior procurement staff at DFRC to discuss the survey findings. Survey Team representatives included Monica Manning and Jim Becker (HQ, Co-Survey Team Leads), Tom Russell (HQ), Gene Johnson (HQ), Diane Frazier (HQ), Gail Skowron (JSC), Jim Kitahara (NMO), Attilla Csoma (KSC), and Ely Chiogioji (HQ). DFRC representatives included Russ Davis (Procurement Officer) and Rich Swanson (Deputy Procurement Officer).

Also on December 9, 2005, Tom Luedtke and Jim Becker held an exit briefing with DFRC Center Management to discuss the findings of the Procurement Management Survey. Russ Davis represented DFRC Procurement at this meeting.

This report serves as a basis, in part, for fulfilling internal control requirements in accordance with the Federal Manager’s Financial Integrity Act of 1982 (P.L. 97-255).

Jim Becker
DFRC Survey Program Manager
Analysis and Assessment Team
Office of Procurement, NASA Headquarters

OVERVIEW

The DFRC Procurement Organization is providing meaningful support to their program customers. The Procurement Management Survey Team interviewed randomly selected technical and program representatives to ascertain any issues or concerns with the current processes. A significant degree of customer satisfaction is apparent from the interviews with the technical community. Additionally, we conducted interviews with all but one of the acquisition professionals to assess the overall organizational climate and effectiveness of the procurement office.

The interviews of technical and acquisition personnel are given roughly equal survey emphasis as the review of contracting actions which focused on compliance with procurement statutes, regulations, and procedures. The thrust of the compliance portion is directed towards systemic procurement processes, as opposed to focusing on individual file anomalies. Attention was also directed to current procurement innovations, both Agency-wide and Center specific.

The results of the compliance reviews and the interviews are detailed as strengths, weaknesses, and areas of consideration. Also, to promote the exchange of successful lessons learned and innovative procurement methodologies between Centers, the team sought to identify DFRC processes or initiatives that might benefit other Centers and, likewise, looked to other Centers for suggested approaches that might be exported to the DFRC.

The exit conference at the conclusion of the survey consisted of a direct exchange of observations and ideas between the participants. To emphasize Center ownership of the resolution of any identified weaknesses or considerations, the survey follow-up process will focus on the corrective actions or initiatives undertaken by the Center. At an appropriate interval (approximately six months after this report is issued) the DFRC Procurement Officer will brief the Assistant Administrator of Procurement and the survey program manager on Center achievements in these areas.

The survey could not have been accomplished successfully without the support from Johnson Space Center, Kennedy Space Center, and the NASA Management Office at the Jet Propulsion Laboratory, and the following individuals:

ORGANIZATION - MANAGEMENT

The Acquisition Management Office (AMO) at DFRC is a single organizational element. It consists of buyers, a price analyst, and policy analyst. The Office receives support from two contractors. One contractor provides 2 work-year equivalents (WYE’s) to accomplish market research and background documentation for simplified purchases and processing of the customer survey inputs. The second contractor, Brace Company, provides contract close-out support thru an Agency wide contract. The buyers are responsible for award and administration of contracts and the BANKCARD program. The price analyst accomplishes 533 analyses, price analysis of awards and modifications, as well as a number of specialized tasks for the Procurement Officer. The Procurement Analyst provides all staff functions such as processing recurring reports and one time Headquarters requests. The Procurement Analyst is also the task monitor for the two support contractors. The Small and Small Disadvantaged Business Specialist is also tasked to award and administer contracts such as the Guard Services contract.

The total on-board strength of the Civil Service Staff at this time stands at 15 individuals with one additional position authorized for recruitment. This represents a decline of 3 persons since the last survey in 2003. At that time we commented that “the AMO’s ability to continue meeting customers’ requirements may be impacted at some point if staffing remains at the current level or if significant numbers of AMO staff are assigned to work other Agency initiatives similar to IFMP in the future”.

Management of the DFRC AMO office fulfills many of the precepts of the GAO Report on the Acquisition Function (GAO-05-218G). The first “Cornerstone” noted in the GAO Report is Organizational Alignment. The DFRC Office is aligned to the appropriate degree of responsibility inasmuch as the Procurement Officer’s rating official is the Center Associate Administrator. That person is a direct report to the Center Director. In this scheme, the Procurement Officer is on an equal level to the Human Resources, EEO, and Security Office. Moreover, the DFRC AMO is assigned total responsibility for purchasing decisions and is viewed by Management as a key player in decisions regarding acquisition strategy.

A second “Cornerstone” of the GAO Report is Policies and Processes. In that regard the DFRC AMO has established processes in the Center Management System which are focused on Center-wide processes rather than focused on individual customers. Further, during the weekly AMO staff meetings “lessons learned” are shared with the entire AMO staff to avoid repetition. Finally, the AMO directive DOP-A-003 provides for coordination with various Center Offices (e.g. Legal, Competition Advocate) which fulfills the criteria within this Cornerstone of coordination caused by structures (as opposed to ad-hoc).

A third “Cornerstone” of the GAO Report is Human Capital. The DFRC AMO has a professional staff that has completed the CON courses as established by the standard established by OFPP Policy letter 05-01. In many cases the training criteria have been exceeded. In addition to the required formal classroom training required of all Federal Acquisition personnel, DFRC has obtained commercial on-site training courses. In the spring of 2006, DFRC intends to have a class on Earned Value for its own personnel, and that of the Project Management and Finance communities. This occurred after an extensive review of available training courses available on that topic.

The fourth and final “Cornerstone” of the GAO Report is Knowledge and Information Management. Most of the elements of this Cornerstone relate to Agency wide software such as that of the new Agency Finance system (IFM) and the upcoming Contract Management Module (CMM). The DFRC AMO has been an active participant in the development and implementation of IFM and CMM. In addition, DFRC has established a customer satisfaction survey report which seeks customer input for incoming purchase actions. Finally, the DFRC AMO reports progress to Center Management against two Agency Metrics: Small Business awards and Performance Based Contract awards. In both cases, DFRC AMO exceeds the Agency criteria for performance.

Due to the size of the DFRC Procurement Office, interviews were conducted with the entire available 1102 workforce to gain insight into their perspectives on the effectiveness of the organization. Interviewing each procurement professional allowed the Survey Team Program Manager to make an assessment utilizing full representation of each grade level within the DFRC Office of Procurement.

The preponderance of the DFRC Office of Procurement workforce stated that morale is good, co-workers and the procurement officers are hard workers and work assignments are accomplished in a professional manner. The interviewees also indicated that they felt that management’s support of balance between work and family and alternate work schedules has had a very positive impact on morale within the organization. Many interviewees spoke very highly of the camaraderie among employees within the procurement staff as a unit.

The procurement workforce responded very favorably in the interview in the areas of communications, training, and management support. The individuals interviewed were very satisfied with the communication from management within the procurement organization. Management holds weekly “buyer’s meetings” that provides a good forum for two-way information exchange between management and employees. The majority of the employees interviewed commented very favorably regarding the management style of the deputy procurement officer and the accessibility of both the procurement officer and deputy procurement officer. Several of those interviewed have come from non-procurement organizations within the Center and stated that management has provided the necessary training and mentorship to ease the transition to the 1102 series.

Individuals within the procurement organization were centralized in one area, which seems to enhance the opportunity for exchange of information and experiences among employees. The effect of this centralized structure seems to provide a good work environment and tended to boost morale in the organization.

The Legal Office and the Procurement Office appear to have a true partnership in identifying effective ways to getting requirements reviewed and awarded in a timely fashion.

An interview was conducted with DFRC's Chief Counsel regarding the relationship between the Legal Office and the Procurement Office, the Legal view of the effectiveness of the Procurement Office, and the overall quality of the files/work products. The Chief Counsel stated that he thought that the relationship with the Procurement Office was very good. He highlighted that the working relationship between Legal and the Procurement Office management team (Procurement Officer, Deputy Procurement Officer, and Mathematician) was extremely effective. For example, the management team has done an excellent job of keeping the Legal Office informed of potential adversarial issues, such as potential claims and disputes. He also stated that the Procurement Office provided innovative solutions in order to get the job done within applicable laws and regulations. In general, the Chief Counsel expressed a high degree of confidence in the ability of the Procurement Office as a whole to meet the needs of the Center.

There was an overall consensus among the individuals interviewed that they received high quality support and they generally expressed a high degree of customer satisfaction. Most of those interviewed specifically identified their procurement team members and said they did good work, commenting on their commitment to the job. Many stated they have close working relationships with personnel who provide procurement support and have excellent communications on pending issues. Procurement personnel are considered knowledgeable about procurement regulations and responsive to the needs of the customers’ organizations. Since several organizations are located within the same office building at DFRC, essentially the entire AMO is co-located with its customers. Customers reported open communications and easy access to the Procurement Management team when needed.

DFRC’s Acquisition Training Coordinator continues to provide outstanding support to the Career Acquisition Training Program in support of DFRC’s 1102 workforce. All GS1102s have received the appropriate certifications for their grade level.

DFRC continues to implement a number of procedures to ensure that their employees meet the continuing education requirement of the Clinger-Cohen Act. As part of DFRC ISO program, everyone maintains their education requirement on the procurement drive. This allows the validation of the continued education training requirement per the Clinger-Cohen Act. Individual Development Plans (IDP) are prepared, updated, and reviewed semiannually and provide DFRC management another tool to ensure training is complete. The last IDP update was in June 2005. To complement the procurement education requirements, DFRC Human Resources sponsored two procurement related training classes last year: Performance Based Contracting in September 2005 and Pricing and Financial Management of Government Contracts and Subcontracts in March 2005.

NFS 1842.270 stipulates that the contracting officer may appoint a qualified Government employee to act as their representative in managing the technical aspects of a particular contract. If an appointment is made, NASA Form 1634, Contracting Officer Technical Representative (COTR) Delegation, shall be used to appoint COTRs. These COTR’s are required to obtain comprehensive training and subsequent refresher training which is required once every five years.

On 5 existing contract files reviewed, the COTR delegations were found to have been properly prepared on NASA Form 1634, and the COTRs acknowledged delegations prior to the contract start in all of the contracts sampled. In all of the files sampled, the contracting officers had determined that the prospective COTRs were listed in the Center’s COTR training certification book and verified that they had received the requisite training prior to issuance of the delegation.

Training of COTRs is managed by a Procurement Analyst within the AMO. The basic COTR Course (3 days) and refresher (1 day) were held in April and October 2005 through a training course sponsored by Human Resources. Refresher training is offered to the COTRs every 5 years. A list of the trained COTRs, including the dates of their training, is contained both on the procurement drive and a procurement notebook for access by contracting officers. A list to this effect was provided to the reviewer.

The COTR training is specialized to cover areas that impact the operations at DFRC, including such areas as the SBIR/STTR program, surveillance plans, and contractor performance assessments. Time has also been allotted to members of the safety office and the security office to cover such areas as the safety and health plan and contract security classification. Members of the procurement staff and legal office attend each of the classes. Due to the size of the center, the procurement analyst overseeing this responsibility can make educated decisions about who may need the class based on their position (e.g. x-COTR’s who are now managers) and encourages those who are serving as technical monitors to receive training. As noted in the past survey, DFRC and ARC have a reciprocal arrangement that allows for their COTR’s to attend the other Center’s classes when need be.

Dryden procurement policies and procedures are documented within the system of Dryden Center-Wide Procedures (DCP) and Dryden Organizational Procedures (DOP). These work instructions provide a set of standards that are established within the requirements of the ISO audits and controls. During this procurement management survey, a few procurement procedures where deemed of sufficient importance that they could merit dedicated instructions. Examples of this finding are:

On a more positive note, the survey team found that DFRC has very few internal/Center-specific clauses, which are sometimes used by NASA Centers to augment FAR and NFS clauses currently in use. Of the Center-specific clauses found in the database, the survey team found none of them to be unnecessarily duplicative relative to available FAR/NFS clauses.

8. Integrated Enterprise Management Program (IEMP), (formerly IFMP) Implementation

Although DFRC has a very small procurement office (staff of seventeen including PO & Deputy), two of its senior-level contracting officers are working issues involving IEMP implementation (SAP, including NPDS-NG under one Sr. CO and CMM under another) with the assistance of two contractor support personnel. The Center’s IEMP implementation procedures include the SAP and FPDS-NG training manuals for use by the procurement staff.

In consideration of the fact that implementation of the Contract Management Module can arguably be viewed as the most important direct contribution the NASA Procurement Offices will make to the agency-wide IEMP implementation, added attention was given to this area by the survey team. CMM will provide a comprehensive tool to support contract/grant writing, procurement management, contract/grant administration, data reporting, and data management for NASA. CMM is slated to roll out in two different waves in May 2006 and October 2006. The goal is that 40% of the Procurement workforce transitions to CMM in wave 1 and 60% in wave 2, with one large center in wave 1. All ten NASA Centers will implement CMM based on the following schedule:

Data cleanliness and validation plans;
Center interdependencies (including NSSC);
Training and facilities readiness;
Degree of change to current business processes; and,
Center participation in CMM Project.

DFRC is one of the Wave 1 (May 2006) Centers. The HQ Office of Procurement earlier reported concerns about response times of DFRC’s Procurement Office to CMM data clean-up requests. That problem has since been resolved with the recent assignment of Louanne Beu as DFRC's CMM Implementation point of contact.

The survey team also noted to Tom Luedtke that the DFRC Procurement Officer signed-off on the CMM Implementation Project Plan (November 17, 2005).

As advised by the prior HQ Procurement Management Survey , the Procurement Officer has made efforts to implement a semi-annual self-assessment process. Subsequent to the last HQ survey performed 3/31/2003 through 4/4/2003, DFRC conducted two internally managed self-assessments. The first internal self-assessment covered the period of 10/1/2003 through 3/31/2004 and the second assessment covered 5/1/2004 through 10/31/2004. In addition to identifying areas within its procurement processes that need improvement, a major function of the Center’s self-assessment process should be to track weaknesses identified during the HQ procurement management surveys and to ensure closure of those weaknesses.

Also, according to the Dryden Organizational Procedure (DOP), DOP-A-010 entitled, “Procurement Process Reviews and Surveys”, in-process reviews must be considered an important element in the procurement review process. Notwithstanding its own DOP, in both of its self-assessments the focus of attention was on Post-Award reviews and the adequacy of file documentation. Neither of the two internal self-assessments addressed problems that exist in the pre-award or “in-process” phases. Several of the weaknesses identified in prior HQ procurement surveys could have (or should have) been resolved, and future reported weaknesses could be avoided with the development by the AMO of some in-process review procedures. Problems found in the in-process reviews as well as weaknesses pointed out during the HQ procurement management surveys should serve as the sources for development of topics for the internal self-assessments.

The self-assessment program needs to focus on a broader range of functions performed within the AMO. Further, the self-assessment program must include a corrective action process. (Note: Per Tom Luedtke, the next internal self-assessment must address the weaknesses that result from this HQ procurement management survey conducted 12/5/2005 – 12/9/2005)

DFRC collects an array of management reports to ensure that the organization as a whole is functioning at a low level of risk and that customers’ needs are being met in a timely and efficient manner. The organization tracks several different metrics, including Purchase Order lead time, which is broken down by whether the award is competitive/non-competitive and/or commercial/non-commercial; the number of awards, which is broken down by the type of action, as well as socioeconomic goals, which are broken down by business type.

Metrics for Purchase Order lead time were provided to the Survey team for the period starting April 1, 2003 through March 31, 2004. The metrics indicate that there were 5 commercial item purchases during this period, and the average number of days from solicitation to award was 87 days. There was 1 competitive, non-commercial award between $100K and $10M during this period and the number of days from solicitation to contract award was 74 days. There was 1 competitive, non-commercial award over $10M during this period and the number of days from solicitation to contract award was 237 days. There were 3 non-competitive/non-commercial awards between $100K and $10M during this period, and the average number of days from solicitation to contract award was 48 days. DFRC indicated that these metrics are no longer being tracked.

DFRC also tracks new awards, broken down by contract type and fiscal year. During FY 05, there were a total of 3,645 new awards. Of this number, 40 were contracts, 9 were grants/cooperative agreements, 269 were Purchase Orders, and 3,327 were Bankcard Orders. The total value of the Bankcard Orders for FY 05 was $2.87M. The values for all other new awards are not tracked. These metrics are not currently being reported to anyone.

DFRC also tracks small business statistics to ensure that it is meeting its socioeconomic goals. The metric is broken down by business size/type. In FY 05, DFRC awarded $76,035 to Small Businesses; $32,604 to Small Disadvantaged Businesses; $6,148 to 8(a) firms; $16,316 to Women Owned Small Businesses; $1,794 to HUBZone businesses; and $2,007 to Service Disabled Veteran small businesses. DFRC met or surpassed its proposed goal in all of these categories in FY 05.

Undefinitized Contract Actions (UCA's) are reported on a monthly basis to HQ. Since closeouts and overage Unliquidated Obligations (ULO's) are managed through the use of the Agency-wide contractor, Brace, there are p-to-date records on file recording the number of closeouts and associated deobligations. Brace reports their progress to their headquarters office, which is then responsible for reporting progress to NASA HQ.

PRE - AWARD

Part 10 of the FAR prescribes policies and procedures for conducting market research to arrive at the most suitable approach for acquiring, distributing, and supporting supplies and services, including the use of commercial items to the maximum extent practicable (FAR 10.001(a)(2)). In addition, the NASA Virtual Procurement Office (VPO) provides a Market Research Guide, which includes a template for a Market Research Report. NASA is required to conduct market research before soliciting offers for acquisitions with an estimated value in excess of the Simplified Acquisition Threshold (SAT).

From the six contracts reviewed, the Survey team found that the majority of these files contained evidence of the market research performed, commensurate with the dollar values and complexities of those procurements. Print-outs of e-mail correspondence with prospective offerors and technical customers, as well as print-outs from searching NAIS, the CCI database, the GSA Schedule, and one-on-one discussions with industry were all included in the file. Sources Sought Synopses were also utilized on two occasions to further solicit interested parties. Requirements were also synopsized and solicitations posted to FedBizOps when appropriate on a consistent basis. However, sole source synopses were often written in such a way as to discourage potential vendors from considering bidding on the requirement by indicating that the process would not result in open competition. Among the files reviewed, some Memorandums for Record also indicated that an effort had been made to find commercial off the shelf (COTS) items to fulfill the requirement.

Although there is evidence of market research in every file reviewed, three of the six files did not contain a Memorandum for Record describing in a narrative format the type and extent of the market research conducted and the results of those efforts, and a Market Research Analysis Report was only utilized on one occasion. The Market Research Analysis Report format provided through the NASA VPO provides a synopsis of efforts in this area, and provides insight into the decision-making process of the Contracting Officer.

Six noncompetitive contract files were reviewed for compliance with FAR Subpart 6.3 and NFS Part 1806. Dollar values ranged from $419K to $10M. All were based on statutory authority (c) (1) - only one responsible source. With two exceptions, all were reviewed and approved at the appropriate levels. The two exceptions are discussed below.

Only one of the six JOFOCs reviewed contained all of the information required by FAR 6.303-2. One JOFOC did not mention a synopsis and no synopsis or waiver was found in the file; did not include an estimated cost; and did not include any signatures. Information missing from the other JOFOCs included: no description of the market research conducted or the results, or reasons why market research was not conducted; no synopsis results; and no statement regarding the actions the agency may take to remove or overcome any barriers to competition.

One JOFOC was approved before issuance of the sole source synopsis, and two were approved during the synopsis response periods. None of these JOFOCs or the contract files contained any information regarding the results of the synopses. One file contained CO justification to condense the synopsis response period to less than 15 days, yet the JOFOC was signed during the condensed synopsis response period. One JOFOC for a follow-on effort was based on the probability of substantial duplication of cost or unacceptable delays in fulfilling the Agency’s requirements, but estimated the cost and delay as “millions of dollars and years of time”, with no specifics as to how the estimate was derived. One file for a sole source blanket purchase agreement contained a sole source synopsis, but no JOFOC. When asked, the CO stated that the COTR did not provide a JOFOC. Subsequently, the CO determined that a JOFOC was not required unless a call order issued under the contract was greater than $25K. Unfortunately, this determination was not made until after two call orders over $25K were issued. A JOFOC was approved for the third call order, but it contained insufficient information.

In several instances, it appeared that the CO’s simply accepted the initial JOFOC developed by the requiring organization, and made no attempt to make necessary revisions to ensure all of the required information was included.

Review of DFRC cost/price analyses was performed to determine whether DFRC understands the steps to be taken to ensure that the price negotiated is fair and reasonable per FAR 15.404 and NFS 1815.404. For this portion of the review, 15 existing contracts and 9 new work modifications were reviewed for cost/price analysis. Of the existing contracts, 7 were under $100,000. Of the files greater than $100,000, 2 were under the SBIR program and 2 were construction contracts. These same files were reviewed for the evaluation of technical evaluations, and pre and post negotiation memorandum documentation.

For those 7 procurements under 100,000, 3 files reviewed contained a simplified acquisition checklist, and the CO demonstrated price reasonableness by comparing previous prices and related commercial item prices per FAR 15.404-(b)(2) (ii). One file under $100,000 had sufficient competition and therefore did not require price analysis. On the remaining 3 files, there were no cost/price analyses in the files.

Of the 9 new work modifications, cost/price analyses were performed using previous contract pricing and related commercial pricing to determine price reasonableness per FAR 15.404.1(b)(2)(ii). On 2 SBIR Phase II and a Research and Development (R&D) contract files reviewed, the cost/price analysis included an evaluation of the individual cost elements per 15.404-1(a)(3) in order to determine price reasonableness. On 4 other existing contract’s files surveyed, the files contained an evaluation of cost/price by utilizing previously proposed pricing and commercial contract prices per FAR 15.404.1(b)(ii). The information in the files appeared to support the cost/price negotiated.

DFRC procurement personnel are supported by the Mathematician. The Mathematician assists in the pricing efforts for procurement activities greater than $500,000, serves as the audit liaison, and assists in the reviews of 533’s, task order proposals, and wage determinations. The Mathematician assisted in the cost/price analysis for several of the existing contracts noted above and the results of this analysis were included in the file. In support of the source evaluation process, the Mathematician also develops the pricing instructions for competitive procurements. This level of experience and expertise provide the DFRC with a great pricing resource.

To strengthen the pricing skills of the procurement professionals, the course “Pricing and Financial Management of Government Contracts and Subcontracts” was brought on site in March 2005. This course was also attended by technical monitors, resource managers, and procurement professionals from JPL.

A review of the technical evaluations was performed to determine if a technical assessment of the type and quantity of materials, labor, and skill mix proposed was made, and if there was an assessment of any other data that may be pertinent to the offeror’s ability to accomplish the technical requirements. For this evaluation 15 existing contracts and 9 new work modifications were reviewed.

Seven of the existing contracts were under $100,000. Four of these files contained a technical analysis using prior contracts and comparable commercial services. The remaining 3 files sampled did not contain cost/price analysis or a technical evaluation in the file.

Generally, the new work modifications and existing contracts greater than $100,000 contained sufficient technical evaluations. For the most part the technical evaluations reviewed contained either an assessment of the cost and skills proposed or an assessment using engineering estimates or related commercial prices. In two of the files, a technical evaluation template was used by the COTR in performing the technical assessment. This template provided an assessment of the following: the proposed costs, including skill and rates; the schedule; the equipment, supplies, and materials; and the travel, subcontract cost, and other costs. On one contract, there was no technical evaluation in the file, but from discussions with the contracting officer, the technical assessment was achieved through a team approach where the project manager/COTR and CO worked together in developing the Pre-negotiation Position Memorandum, and then having the COTR sign the document.

One of the SBIR Phase II files reviewed did not contain a technical evaluation, but rather used the assessment of technical merit as the technical evaluation. Another of the contract files contained a technical assessment that did not extensively address the labor or the material proposed or any of the technical considerations related to the proposal.

The survey team reviewed pre- and post-negotiation documentation for 15 existing contracts and 9 new work modifications to determine if the documentation met the requirements set forth at FAR Part 15.406 and NASA FAR Supplement 1815.406. Of the existing contracts, seven were under $100,000. A standard Simplified PNM template was used for some of files reviewed with values under $100,000, and used in some of the new work modifications. The benefit of this form is that it prompts the contracting personnel to discuss the following: comparison with prior purchase of same or similar item, commercial catalog published price list, established market price, and analysis by the buyer/user/technical personnel. This template aids in performing the assessment required by 15.404.1. However, on one occasion the template did not contain a validation of the prices of similar items and the government estimates stated in the form. Further, CO’s need to be cautioned of the fact that although the DFRC Simplified PNM template includes the areas required by FAR 15.404.1(b) it does not address all that is required by FAR 15.406 and 18.15.406. In addition to not including a technical evaluation or cost assessment, three files reviewed with values under $100,000 also did not document the results of the negotiations.

The review of DFRC’s PPM’s and PNM’s was performed to ensure that the objectives contained FAR 15.406 and NFS 18.406 are being met. Per the FAR, the discussion contained in the file should include all pertinent information on field pricing assistance, audit reports, technical analysis, fact-finding results, independent Government cost estimates and price histories. Also, when cost analysis is required, the contracting officer should document the pertinent issues to be negotiated, the cost objectives and a profit or fee objective. Per 15.406 and 18.406, the contracting officer shall document in the file the principle elements of negotiations including the purpose, a description of the acquisition, the negotiation team, the status of the systems, if cost or pricing data were required and the extent to which the contracting officer relied on the cost or pricing data submitted, a summary of the contractor’s proposal, any field pricing recommendations, the basis for the profit or fee and documentation of fair and reasonable pricing.

In DRFC’s attempt to meet the requirements of the FAR and NFS, in a majority of the files sampled, PPM and PNM templates were used. The PPM template includes the following information: type of action, contractor, place and period of performance, negotiation schedule, background, special features and requirements which includes technical consideration, subcontracting, contractor systems, government property, cost and price analysis and profit and fee analysis, negotiation team and schedule, and negotiation plan/approvals sought. Generally, of the 5 existing contract actions reviewed that were greater than $100,000, each file generally discussed all the areas in the template and also covered all of the areas prescribed in 1815.406-170 in their PPM. Also, the existing contract files included either a detailed cost/price assessment using the elements of cost or prices for data or previous contract pricing and related commercial pricing.

The DFRC PNM Template includes the procurement background, a discussion of the adequacy of the contractor’s systems, a discussion of the results of the negotiation, including reliance on contractor data, profit, current cost and pricing data, and fair and reasonableness of the pricing. The PNMs for actions greater than $100,000 generally addressed the status of the contractor systems and the reliance on contractor data. Also, in those PNMs sampled for contracts greater than $100,000, the contracting office provided the analysis required by FAR 15.406 by adequately addressing each area of the template.

To determine adequate use of the Structured Approach in Profit/Fee Determination, five existing contract files were reviewed. Per NFS 1815.404-471, the purpose of the Structured Approach in Profit/Fee Determination is for the contracting officer to adequately assess performance risk, contract risk, and other considerations in determining a fair and equitable fee or profit. This analysis shall be used in determining the profit or fee objectives in negotiations of contracts greater than $100,000. Of the 5 the files sampled, 3 contained a NF 634; all elements of the form were properly filled out and supporting documentation was attached to the form. Generally, the supporting documentation contained the rationale behind each weight assigned to materials, technical, management, past performance and socioeconomic, cost control, contract type risk, and other considerations. The weightings assigned in each instance appear to align with the guidance contained in NFS1815.404-71. In the SBIR files a template for Rationale for Structure Fee/Profit determination was used with the NF 634.

The two files that did not contain a NF 634 included one for construction and one for ODIN Task Order 2. On the construction file, the contracting officer stated that the NF 634 was not completed because the contracting officer planned to negotiate the standard fee/profit for construction without supporting data regarding this standard. For the ODIN Task Order 2, which also exceeded $100,000, the contracting officer recommended a different fee than that proposed. A Structured Profit/Fee Determination could have been utilized to determine a fair and equitable fee/profit.

7. Adequacy of Documentation for Awards Resulting from Broad Agency Announcements (BAAs)

Three contract files were selected for review. One contract was awarded as a result of an Exploration Systems Mission Directorate (ESMD) BAA released from Headquarters. Two of the contracts awards resulted from selections under an Intramural Call for Proposals (ICP) released by the ESMD. Although the ICP is not considered a BAA, the circumstances for awarding resultant contracts are similar in certain instances.

The contract awarded as the result of the ESMD BAA included all necessary supporting documentation in the file, and the file was reviewed and approved at the appropriate level. The two contracts awarded as the result of the ESMD ICP were based on selection of a proposal submitted by DFRC. The ICP was issued internally to the NASA Centers, who submitted competing proposals. The DFRC proposal included collaborations with two universities. When the DFRC proposal was selected, contracts were subsequently awarded to the universities for their support.

The file documentation for these contracts states that the contracts were awarded competitively, presumably because the ICP was a competitive process. No documentation was found that described the process by which the universities were selected to be part of the DFRC proposal, and how the selection process complies with the Competition in Contracting Act (CICA). It appears that the DFRC technical organization simply chose their university collaborators without a competitive process or any noncompetitive authority, and subsequently awarded contracts, considering the awards to be competitive based on the competitive ICP process.

The ICP contract files contained synopsis waivers stating that DFRC did not need to synopsize because ESMD had previously synopsized the procurement, however, no ESMD synopsis was included with the waiver or found in the file. One of the synopsis waivers was not signed by the CO. It appears doubtful that ESMD would have synopsized a call for proposals internal to NASA.

In the 2003 HQ survey n ine (9) contracts were randomly selected for review and a variety of weaknesses were identified in the area of PBC. The specific weaknesses were related to missing surveillance plans; lack of clearly defined statements of work (SOWs); and incorrectly coded Individual Procurement Action Reports. In addition, it was observed (as it was at most other Centers during this time), that there were instances where DFRC appeared to stretch the definition of what was considered to be PBC. As a result of the findings from the previous survey, a sampling of DFRC’s contracts (identified as PBC on the list of active contracts provided to the survey team) were reviewed for improvement in the areas previously identified as weak.

For this survey, five contracts identified as PBC on the listing were reviewed. The mix was chosen from contracts awarded after completion of the last survey and included DFRC’s two largest cost-reimbursable service contracts; and three randomly selected fixed price contracts listed as PBC (extracted from DFRC active list of contracts). Of these five contracts, the two large cost-reimbursable service contracts were correctly categorized as PBC. These contracts included well written Performance Work Statements (PWS’s), Surveillance Plans were developed that documented how the Government would monitor contractor performance against the established contract performance requirements and standards, and performance incentives were included through an award fee structure and met the requirements of FAR 37.601 (it should be noted that the two contractors associated with these contracts (AS&M and Arcata Associates) have just been recognized by NASA with NASA Small Business Contractor of the Year Awards). Review of the remaining three fixed price contracts indicated that they also were appropriately listed as PBC.

Seven interagency agreement files were reviewed for compliance with FAR 17.5 regarding Interagency Acquisitions Under the Economy Act; NFS 1817.70 regarding Acquisitions with Military Departments; and NFS 1817.72 regarding Interagency Transactions.

All of the files used the NDPR Form 523 in accordance with NFS 1817.7002. None of the NDPR forms had Block 8 checked to cite the Space Act authority, however, the authority was stated under the description of the supplies and services. None of the agreements contained a payment clause requiring the submittal of a final invoice within six months after the completion date of the order in accordance with FAR 17.505 and NFS 1817.7203. None of the agreements contained a provision for procedures for resolution of disagreements between the parties in accordance with FAR 17.504(c). None of the agreements for supplies or hardware contained the property clause in accordance with NFS 1817.7002-4. Several agreements cited a Statement of Work, or a Memorandum of Agreement (MOA), or a Statement of Capabilities under the description of the supplies and services. These documents were not attached to the agreement, but only included in the file under the procurement request tab. In two instances, MOAs were included in the files, but were not cited in the agreements.

Five of the seven agreements were signed by the COs after the periods of performance commenced. The delays ranged from one day to four months. One amendment to extend the period of performance was executed 20 days after the original period of performance expired. Two agreements commenced prior to the date of the procurement request found in the file. Two agreements were for periods greater than five years, but no approved deviations from the five year period of performance limitation in accordance with NFS 1817.7201 were included in the files.

All of the files contained the required Determinations and Findings (D&F), however, none of the D&F’s contained all of the information required by FAR 17.503 and NFS 1817.7202. One D&F was not approved by the CO, and four others were not signed until after the agreements were executed. Delays ranged from three days to 3.5 months.

The survey team reviewed the two existing A&E contracts, one that has recently expired and the follow-on contract which was recently awarded. Dryden issues five year ID/IQ contracts for these services. They do not have a permanently established A&E evaluation board in place given this contractual arrangement and given the relatively few requirements for A&E services at the center.

Both basic contract files were thoroughly documented and organized. A review of the two most recently issued delivery orders under the older contract indicated that they were well documented and organized. The description of work to be done under the orders was clear. No orders have been placed against the new contract yet.

The previous Dryden survey indicated an area of concern regarding evaluation of the contractor’s performance. FAR 36.604 requires that for each contract of more than $25,000, performance evaluation reports shall be prepared by the cognizant contracting activity, using SF 1421, Performance Evaluation (Architect-Engineer). Despite this previous finding, the SF 1421 is not being provided consistently. The file for the recently completed A&E contract only contained an SF 1421 for three out of eight delivery orders on the contract. The Contracting Officer indicated that they had not been aware of this requirement and that these evaluations have not been performed for recent tasks.

The survey team reviewed the contract with Infinity Technologies, Inc., that provides general administrative services to Dryden. This contract provides a myriad of administrative support to different offices across the Center. In addition to reviewing the documentation in the contract file, the survey team interviewed several contractor personnel to determine whether the nature of their employment was of a personal services nature as defined by FAR 37.104 (a).

The pre-award contract file for the Infinity contract was not available for review, but based on the NF1098, it does not appear that any determination was done to address whether the contract was a personal or non-personal services contract, in accordance with FAR 37.103. Given the nature of the services provided under this contract, such documentation should have been contained in the file. The fact that the contractor submitted a Personal Services Avoidance Plan as part of their proposal validates this finding. The Personal Services Avoidance Plan was thorough and based on interviews with several of the employees under the contract, many of the avoidance procedures proposed in the plan are in place and working effectively under the contract to prevent personal services more than five years after contract inception.

During the review of the Infinity file, the Survey Team noted two perception concerns. First, some contracting officers have tasked the Infinity contractors with signing out distribution letters. While these letters do identify the signatory as an Infinity employee, such a practice can lead to confusion and perception issues as to the level of responsibility held by the contractor regarding important contract actions. Secondly, we noted that some purchase requisitions that fund the Infinity contract are initiated by Infinity employees who provide support to the financial office. This, too, is a practice that could cause perception issues and possibly financial control issues if the civil servants approving the purchase requisitions are not diligent in their roles.

The Survey Team reviewed three open construction contracts. Clauses were in order and the contract files were well maintained. Improvements in construction contract administration have been made since the last procurement survey. Performance and payment bonds were not adjusted when construction contracts increased in value.

All three construction contracts reviewed contained the NASA prescribed Safety and Health clauses, 1852.223-70 and 1852.223-73. However, in discussing this issue with the lead construction C.O. at Dryden, the survey team became aware that Dryden has been requiring construction contractors to submit Accident Prevention Plans in lieu of Safety & Health Plans. The FAR requirement for submission of Accident Prevention Plans (36.513 & 52.236-13) is superseded by NFS 1836.513 and 1852.223-70, which requires the submission of Safety and Health for construction contracts. Further, in reviewing the contents of the Accident Prevention Plans submitted by Dryden construction contractors, we determined that they did not address all elements required for NASA Safety and Health Plans, in accordance with NASA Procedural Requirement (NPR) 8715.3. Please note that Appendix H of this guidance document provides a sample Safety and Health Plan for future reference.

POST - AWARD

Three CPAF contract files were reviewed to ensure compliance with applicable clauses and regulations. The two latest evaluation periods were reviewed for each contract. Award fee evaluations followed the applicable award fee evaluation plans, were well documented, and thoroughly supported the fee determination in each contract file that was reviewed. The files contained extensive minutes/documentation to explain the decisions that were made. Except for one period, award fee payments were made well within the 60-day time frame required by the NFS.

It was noted that one of the performance evaluation plans was approved 1.5 months after the contract started. It was also noted that the Business Management factor for one contract’s evaluation periods was weighted at 25 percent, divided between cost control (20 percent) and financial reporting (5 percent). Another contract’s evaluation periods utilized a Business Management factor weight of 20 percent, covering four criteria: deliverables, cost, acquisitions/receiving and labor relations. These weightings do not comply with NFS 1816.405-274 which requires that cost control shall be no less than 25 percent of the total weighted evaluation factors when explicit evaluation factor weightings are used, and that the predominant consideration of the cost control evaluation should be a measurement of the contractor's performance against the negotiated estimated cost of the contract.

Six contract files were reviewed for compliance with NFS 1842.72, NASA Contractor Financial Management Reporting. All of the contracts met the contract type and dollar thresholds requiring financial management reporting. All of the contracts included NFS clause 1852.242-73 requiring NASA Financial Management Reporting. The clause requires that the detailed reporting categories to be used shall be set forth in the contract, as well as the number of copies and time and manner of submission. Only four of the contracts contained data requirements descriptions that covered the required information. The other two contracts did not contain any requirements in addition to the clause, however, the COs stated that the contractors were submitting information in a format and number of copies sufficient for financial tracking and analysis.

NFS 1842.7201(a)(1) requires COs to monitor contractor cost reports on a regular basis to ensure cost data reported is accurate and timely, and to pursue adverse trends and discrepancies discovered in cost reports through discussions with financial and project team members. All of the files were documented to show that the COs did some kind of review and/or analysis.

Five files contained an “adequacy checklist” completed by the CO indicating review and adequacy of the NF 533 submitted. Although the “adequacy checklist” noted above may be helpful to ensure that all of the necessary fields on the NF533 have been completed, it does not contain any information regarding timeliness, accuracy, any analysis that was completed, or any necessary follow-up corrective action.

In March 2004, the agency implemented policies and procedures to improve the option exercise decision making process, and documented these improvements in NFS 1817.207-70. Particular focus was placed on (1) conduct of market research, (2) importance of role played by Program/Project Management, (3) importance of considering satisfactory contractor performance in accordance with NFS 1842.1503 and/or as evaluated and documented by NF 1680, and (4) initiating these processes in time to make an informed business decision as to whether the option exercise continues to be the best programmatic path (i.e., instead of routinely notifying the contractor of the government's intent to exercise the option, which is usually forwarded 60-90 days prior to the contractual option exercise date).

The review of DFRC’s option exercise modifications did not indicate that DFRC has implemented the option exercise improvements. Six option exercise modification files were reviewed by the team. Of the six files reviewed, one modification was executed on a bilateral modification, even though no other terms or conditions were being changed; one modification did not clearly state which option was being exercised or that the period of performance was being extended; three modifications did not have the necessary determination to exercise the option (FAR 17.207) and of the four that did, all but one were incomplete in some way. Two did not show any evidence of coordination with the Program or Programmatic input in the decision to exercise the option; three did not state that exercising the option was in the best interest of the Government or explain why this was the case; five did not address the NFS 1842.1503 requirement to discuss the contractor’s performance during the previous period, and none of the files contained this documentation of NF Form 1680; four of the modifications did not provide any evidence of market research conducted to support the decision to exercise the option, and finally, four of the files did not contain the appropriate advance notification to the contractor of the Government’s intent to exercise the option.

Of the four files that contained the necessary determination, all were documented pretty consistently that funds were available and that the requirement covered by the option fulfills an existing Government need, but few contained sufficient rationale that the exercise of the option was the most advantageous method of fulfilling the requirement. Further, few of the determinations appeared to be made in sufficient time to conduct a competition if the determination had resulted in a finding that the exercise of the option was not the most advantageous means of meeting the Government’s requirement.

Of the files reviewed, only one file contained all the necessary documentation required by FAR 17.207 and NFS 1817.207, with the exception of evaluating and documenting the contractor’s satisfactory performance on a NF Form 1680.

Six contract files were reviewed for compliance with NFS 1842.15. Three files contained the NF1680 forms, with some for more than one period. One file did not contain a report even though the annual period ended in June 2005; one file’s report was in process, but significantly late considering the annual period ended in June 2005; and one file did not contain a report because it was a BPA, and after the first 21 months no orders had been issued, so there was no performance to assess.

NFS 1842.1502 requires that within 60 days of every anniversary of the award of a contract having a term exceeding one year, contracting officers must conduct interim evaluations of performance on contracts subject toFAR Subpart 42.15. Although some of the reports may have started on time, all of them were late in being completed, some by several months.

Of the three files containing the NF1680 forms, two contained narrative explanations to support the ratings, and all files evidenced discussion of the evaluation with the contractors. All of the evaluations were properly signed by the CO upon completion.

Only two of the three files containing NF1680s had the reports posted to the Past Performance Data Base (PPDB), and posting of these reports was sporadic.

In addition to the six contact files noted above, three CPAF contracts were reviewed for posting of award fee evaluation data in the PPDB. Only two had reports posted to the PPDB. The reports did not contain narratives supporting the ratings, and posting was also sporadic.

5. Task Orders (Competition under Multiple Award and Delivery Order Contracts)

There were only two contracts awarded on a multiple award basis to be reviewed. The two contracts were valued at $2.5M each. The files were reviewed and while the Delivery Orders appeared to be relatively equitably split between the two contractors ($437,820 vs. $241,608), the files did not contain any evidence that the orders issued under the contracts were competed between the two contract holders as required by FAR 16.505(b).

According to the Contracting Officer, although both contracts were basically for the same or very similar type items, it was the technical representative who determined which contractor would get which order based on his knowledge of the manufacturing expertise for each contractor, and therefore the orders were not competed. Both contracts are physically complete at this time, and there are no outstanding orders on either contract.

A Contractor Insurance/Pension Review (CIPR) is an in-depth evaluation of a Contractors insurance program; pension plans; and related policies, procedures, practices, and costs to determine whether they are in compliance with the FAR and pertinent contract clauses. DCMA guidelines state that a CIPR is only normally conducted when: (i) A contractor has over $40 million dollars of qualifying sales to the Government during the contractors preceding fiscal year; and (ii) The ACO, with advice from DCMA insurance/pension specialists and DCAA auditors, determines a CIPR is needed based on a risk assessment of the contractor’s past experience and current vulnerability. Per DFARS Subpart 242.7302(a)(2), qualifying sales are sales for which cost or pricing data were required under 10 U.S.C. 2306a, as implemented in FAR 15.403, or contracts priced on other than a firm-fixed-price or fixed-price with economic price adjustment basis. Sales include prime contracts, subcontracts, and modifications to such contracts and subcontracts. Note: DCMA follows the DFARS guidance for performing CIPR’s. The review of a contractor’s compensation structure, including pension plans, and its insurance plans are two of the contract administration functions found in FAR 42.302 normally delegated by NASA to the contract administration office (CAO) which is usually the Defense Contract Management Agency's Administrative Contracting Officer (ACO). CIPR's are usually self-initiated by the ACO; however, if NASA or any other Government agency believes that a review should be conducted, a recommendation to that effect should be provided to the ACO. If the ACO concurs, the review may be conducted as a special CIPR or as part of an already scheduled CIPR.

Based upon the above guidance, the survey team reviewed the contract files of the three (3) largest cost-reimbursable contractors at DFRC to determine whether the contracting officers were following the applicable guidance and/or regulations. The dollar values of the applicable contracts reviewed were approximately $22,795,000 (CSC), $49,966,000 (AS&M), and $160,000,000 (Arcata). It is noted that the total estimated contractual values stated above for CSC and AS&M is for five (5) years effort; and ten (10) years effort for Arcata. Review of the files determined that the CSC contract is a CCI effort being performed at DFRC under a JSC contract. Considering this fact, the requirements for a CIPR review would have been requested under the JSC contract. The other two Contractors (AS&M and Arcata) are Small Businesses that do not meet the yearly dollar threshold for CIPR reviews. Based on these findings, no CIPR reviews are required for the contracts reviewed.

Accounting System
Billing System
Purchasing System
Estimating System
Compensation System

A total of four (4) large cost-reimbursable contracts were reviewed in the area of subcontract consents. A review of the files indicated that all of the contracts contained the required FAR 52.244-2 Subcontracts Alt I clause. One of the contracts (CSC) identified a special surveillance consent requirement threshold of $100,000.00 for advance notification and consent approvals even though the contractor had an approved purchasing system. This special surveillance requirement was included in the contract requirements per the fill-in block of FAR 52.244-2 (e). In addition, another Contractor (Arcata Associates) also had an approved purchasing system based upon a special CPSR conducted per the request of the DFRC Contracting Officer. Per Arcata’s approved purchasing system, the advance notification and consent threshold is $1,000,000.00. Per NFS 1844.201-1, it was determined by DFRC that no special surveillance of Arcata’s subcontracts was required. Review of the other two files indicated that one of the Contractors did not have an approved purchasing system because a CPSR was not required based upon the volume, complexity and dollar value of their Government subcontracts; and the other contract did not have a requirement to subcontract any of the requirement.

In reviewing a sample of the consent packages received by DFRC for approval, it is noted that FAR 44.202-2 has 13 specific considerations that the Contracting Officer must address prior to granting subcontract consent. All of the consent files reviewed (with the exception of one) contained a checklist based on the requirements of FAR 44.202-2. During the review, it is noted that the consent letters did not identify the prime contract number(s) under which consent was being provided. The letters did contain consent limitation language found at FAR 44.203(a), i.e., "The Contracting Officer's consent to this subcontract does not constitute a determination of the acceptability of the subcontract terms or price, or of the allowability of costs." In addition to the consent letters, the subcontract file documentation was reviewed to ensure compliance with the referenced specific considerations delineated in FAR 44. 202-2; this review of the support information contained in the consent packages indicated that DFRC is conducting a thorough review and analysis of the consent packages in compliance with the FAR provisions; and that the level of analysis was appropriate based upon the complexity and criticality of the subcontract procurement action.

Eight contract files were randomly reviewed for compliance with the FAR 5.301(a) requirement to synopsize contract awards. Four of the files reviewed contained a properly submitted post award synopsis in the contract file, three of the files did not contain a post award synopsis, and one file was not applicable as it was a GSA schedule order which did not require either a pre-award or post-award synopsis. The three files that did not contain a post award synopsis did not contain any justification as to why a synopsis was not in the file. Discussions with the applicable Contracting Officer administrating two of the contracts indicated that he inherited the already awarded contracts from another Contracting Officer (who is not available for this review). The third file was an older procurement where the documentation was missing. Of further note, these three files did not meet any of the eight (8) FAR exceptions referenced under FAR 5.301(b) as to exemption from the post-award synopsis requirement. Discussions with the DFRC procurement policy lead indicates that all post-award synopsis documentation should be contained in the contract file as opposed to a central repository. Additionally, a review of the NAIS EPS system confirms that there is no record of a post-award synopsis being posted for the three referenced contracts.

Two of the active construction contracts at DFRC were reviewed to determine if the request for progress payments adhered to the requirements set forth in FAR 52.232-5 "Payments under Fixed-Price Construction Contracts". Under this clause, the Contractor’s request for progress payments shall include the following substantiation: (i) An itemization of the amounts requested, related to the various elements of work required by the contract covered by the payment requested. (ii) A listing of the amount included for work performed by each subcontractor under the contract. (iii) A listing of the total amount of each subcontract under the contract (iv) A listing of the amounts previously paid to each such subcontractor under the contract.(v) Additional supporting data in a form and detail required by the Contracting Officer. Along with each request for progress payments, the Contractor shall furnish the a certification as set forth in FAR 52.232-5

In one of the files reviewed, the DFRC Contracting Officer returned the initial invoice and requested the contractor to provide progress schedule and contract progress reports prior to processing invoices. The Contracting Officer recommended that the contractor use Air Force forms 3064 (Contract Progress Schedule) and 3065 (Contract Progress Report) for this purpose. Although these forms detail the construction progress, it was evident that in the file reviewed that used these forms, the contractor did not delineate the work performed by the subcontractor per FAR 52.232-5. The other file reviewed that included construction progress payments included work performed by the subcontractor.

Dryden Form FD-5 (Construction Contractor Invoice) serves as the cover to the contractor’s invoice. This form provides areas for 2 Government endorsements of the invoice prior to approval for payment. The invoices reviewed were each endorsed on the Dryden Form FD-5 by the project manager and the contracting officer prior to requesting payment. Each invoice reviewed included a certification from the contractor that meets the requirements of FAR 52.232-5. Of files reviewed, 2 invoices were returned to the contractor due to lack of progress. From the reviews of the file, it appears that the procurement office and the technical office are actively involved in review of the progress payments.

The team review of closeouts and unliquidated obligations consisted of examining DFRC’s closeout procedures to ensure that they are in accordance with FAR 4.804 requirements and trend analysis (i.e. schedule time frame by contract type, use of quick closeout procedures, open actions, and overage ULOs) for the closeout of completed contracts, purchase orders, grants, inter-agency agreements and the status of unliquidated obligations.

DFRC has a documented procedure (DOP-A-009 Transfer of Procurement Files to Closeout) that is in accordance with FAR 4.804 requirements including the use of the appropriate forms (NF 1611 Contract Completion Statement and NF 1612 Contract Closeout Checklist), and encourages the use of Quick Closeout Procedures when appropriate. Since September 2000, DFRC’s closeouts have been accomplished by the Agency closeout contractor, BRACE Management Inc., who also has established closeout procedures that are in accordance with FAR requirements. Brace provides support to the acquisition division, and is responsible for preparing all closeout documentation for the Contracting Officer's review and approval.

As part of their contract, Brace uses certain metrics to track monthly closed and deobligated dollars by action type, open, closed, and overage cumulative summary reports. During FY 05, Brace closed a total of 276 NASA contracts and deobligated a total of $428,635 ULOs. The latest data provided to the Survey team indicated that as of December 1, 2005, DFRC had a total of 28 overage contracts that were physically complete, but which are not administratively closed, and obligated funds are not yet liquidated. Of the 28, 2 were Cost Reimbursable contracts, 7 were Interagency Agreements, and 15 were Purchase Orders, 2 were cooperative agreements, 1 was an IDIQ contract, and 1 was a Firm Fixed Price contract. The total value of unliquidated obligation is approximately $1 million. During the last six months, Brace has closed out 137 contracts on, or prior to the target closeout date, including 112 purchase orders, 10 Fixed Price Contracts, 13 Interagency Agreements, and 2 Cost Reimbursable contracts. The overage factors can be attributed to delays in receiving DCAA final audits, the contractor not yet having submitted final invoice/voucher, pending litigation, and waiting on reconciliation and final payment.

GRANTS, COOPERATIVE AGREEMENTS, SIMPLIFIED ACQUISITIONS, AND OTHER ISSUES

During the last survey, DFRC was transitioning the grant and cooperative agreement award and administration functions to Glenn Research Center. According to information provided to the survey team by DFRC, full transition has taken place. Thus, since the last HQ procurement management survey DFRC has not awarded any grants or cooperative agreements, and none are being administered by the Center.

Nine Purchase Orders were reviewed. The files were reviewed to determine if appropriate documentation existed, and that a reasonable selection was made in the award. Specifically, the review consisted of the following: was there a certified PR and a Certifications and Special Approvals for IFM Purchase Requisitions (NASA Form 1707) included in the file; was the requirement split to circumvent the procurement process; was there evidence in the file that FAR Part 8, Required Sources of Supplies and Services was considered prior to completing the purchase; if noncompetitively awarded, was the reason adequately documented; if the requirement was over $25K, was the requirement synopsized; was a determination of price reasonableness completed; was market research adequately performed and documented; were the appropriate Terms and Conditions used; was the Small Business Review Sheet (A-24) filled out, and if the small business set-aside was dissolved, was it properly documented (Form A-1); were the Representations and Certifications included in the file; were CCR and Cage Codes included in file; was there evidence that the debarred list was checked prior to award; was VETS compliance required; and was the file reviewed at the appropriate level.

A large number (nine of nine) of the SAP actions reviewed were awarded on a noncompetitive basis, citing either unusual and compelling urgency or only one responsible source available. Note that greater than 80 percent of the Purchase Orders on the active contract list were awarded non-competitively. In some instances (three), the rationale documenting acquisition from a sole source appeared to be insufficient. All nine justifications were written and signed by the program manager or requisitioner only, and none of the files reviewed contained the Contracting Officer signature. Of the files reviewed, four did not have the required Small Business Review Sheet (Form A-24); one did not have VETS compliance; one did not have a quote or Representations and Certifications included in the contract file; three did not have Terms and Conditions attached to the Purchase Order; and three did not have Market Surveys or any evidence of market research conducted in the file. All nine Purchase Orders used the Government Estimates comparison to determine price reasonableness, however, there was no Independent Government Estimate included in any of the reviewed files, per the requirement set forth in FAR 4.803(a)(7). One Purchase Order appeared to be in violation of the Anti-Deficiency Act (ADA) as the Purchase Order amount was twice the amount of the Purchase Requisition. There was no explanation in the file for this discrepancy. Finally, in the case of two Purchase Orders, there is reason to suspect that the requirement was split in order to circumvent the procurement process. Although both the apparent ADA violation and the requirement split appear to be isolated incidents, special care should be taken to avoid these situations in the future due to the serious nature of the incidents.

The team focused on the internal controls, training, number of card holders, automated tracking system, monthly reconciliation, violations, and limits (individual/monthly) placed on card holders pursuant to the government bank card regulations.

Since the last Dryden survey, the purchase card program has been managed by several different Center purchase card program coordinators (CAPC). The current CAPC has been responsible for the program for two months, and is still learning some of the nuances of the system. In addition, this individual is responsible for administering two of the largest support service contracts held at the Center and for awarding some SBIR and purchase orders. As a result, this person is only able to support the purchase card program as a part-time responsibility. The CAPC is currently being assisted by an intern who is helping to review the files of the cardholders and identify inconsistencies of purchase limits and active users between the Bank of America system and the NASA Purchase card (P-card) tracking system.

The new CAPC is in the process of reviewing each cardholder’s file to determine if training requirements are up to date (card users are required to take refresher training every three years). A random review of 22 files of current purchase card holders indicated that 27% of the cardholders were past due for their refresher training.

The CAPC is assessing the cards currently in use to determine if there any are underutilized that should be cancelled or if there is any opportunity for consolidation of card holders/approvers in offices where there may be more participants than necessary. The CAPC has also been working to ensure that both the Bank of America system and the NASA P-Card system properly reflect active users. In at least six cases, cards were cancelled in the Bank of America system but are still shown as active in the P-card/CIRIX system. A reconciliation of these differences is in process.

A spot check of three purchase card users’ log and reconciliation process indicates that these individuals know how to use the P-card system and perform a thorough review of charges placed against their cards. The P-card system is cited by users as being very easy to use. A separate spot check of six invoice summaries for randomly selected card holders, identified one questionable transaction. This transaction turned out to be a split purchase that was done to bypass the card holder’s individual purchase limit of $2,500. The card holder and the CAPC were notified by the survey team of the inappropriate nature of these transactions.

The CAPC currently relies on transaction approvers to screen for questionable transactions such as the one cited above. The CAPC is still in the process of determining how to run reports that will facilitate identification of questionable transactions, such as those over the individual limit or purchases to vendors that might not be appropriate. However, the CAPC is not yet aware of all the tools that are available to assist with these responsibilities.

Initially, there appeared to be at least 12 card holders (out of 59 initially identified) that had individual transaction limits of $25,000 or more. Six of these card holders were assigned monthly limits of $250,000 and 6 had monthly limits of $999,999. These limits were based on the information provided under the NASA P-card system. However, as a result of our review, we determined that at least seven of these cards were cancelled during this year in the Bank of America system, and two others’ limits had been adjusted to lower their limits to $2,500 per transaction and $25K per month.

The new CAPC is very interested in properly administering the program, however, they have not been able to take full responsibility for the program due to other work assignments. The steps being implemented by the new CPAC and the intern will lead to better control of the P-card program, however, the CPAC needs to become fully apprised of reporting tools that can be used to identify split purchases, inappropriate purchases and purchases in excess of the purchase limits for individuals. Follow-up on questionable transactions should be a monthly part of the CPACs responsibility.

The Procurement Analyst assists the SBIR Program Manager in managing the overall SBIR program for DFRC. As such, he is responsible for assigning/distributing the SBIR proposals to the Contracting Officers. Normally the center receives between 10 and 15 Phase I SBIRs, 4 to 6 STTRs, approximately 6 SBIR Phase II’s and 3 STTR Phase IIs. To assist the Contracting Officers in meeting the schedules related to this program, the Procurement Analyst creates model contracts and provides for model templates for PPN’s and PNM’s. He also sets up the files for each of the DFRC SBIRs. This provides a more streamlined approach and ensures that appropriate data in contained in the contract file.

For this survey, 4 of these files were reviewed. In general, of all the documentation in the files was complete. Use of the model files and template appeared to help ensure that the appropriate documentation was contained in the files and that the PPM’s and PNM’s were complete. Only on one occasion was the technical evaluation not contained in the files. To ensure that the COTRs recognize their responsibilities related to this activity, training was included in this regard in the recent COTR training session

Contract files were reviewed to verify compliance with NFS 1823.70, Safety and Health. Per NFS 1823.70(e), all contracts in excess of the micro-purchase threshold must include either clause 1852.223-70 Safety and Health or 1852.223-72 Safety and Health (Short Form) depending upon the input received from the technical organization and the safety organization. In accordance with NFS 1823.7001(d), the Contracting Officer must also insert clause 1852.223-75, Major Breach of Safety or Security, in all solicitations and contracts with an estimated value in excess of $500,000. NFS 1823.7001(c) further states that if clause 1852.223-70, Safety and Health, is required to be incorporated into the contract, the Contracting Officer must also include the provision at 1852.223-73, Safety and Health Plan in the solicitation, and incorporate the contractor's Safety and Health Plan into the contract after receiving the concurrence of the center safety and occupational health official(s).

For clarification purposes, it should be noted that all contracts reviewed in this area had estimated values of $500,000 or more. A total of 3 files were reviewed by the Survey team. Of the 3, 1 was for engineering services; 1 was for logistics services, and 1 was for construction. Both the engineering service contract and the construction contract contained all the appropriate safety and health clauses, as well as the Safety and Health Plan required by solicitation provision NFS 1852.223-73. In addition, the file contained evidence that the plans were reviewed by, and coordinated with the appropriate safety and occupational health official(s). The contract for logistics management services contained NFS clause 1852.223-70, but not 1852.223-75, which is required for contracts above $500,000. The contract contained a very broad Corporate Safety Policy, but not a Safety and Health Plan that met the requirements of NFS provision 1852-223-73. Further, the file contained no evidence that the plan was reviewed by or coordinated with the appropriate safety and occupational health official(s).

A review of DFRC’s current list of active contracts indicates that there are eight (8) contracts that list Government Furnished Property (GFP) and/or Installation-Accountable Government Property . Out of these 8 contracts, four (4) were issued prior to FY2003 and were previously subject to review in the last procurement survey. As such, this survey/review will focus upon the 4 contracts containing GFP/Installation-Accountable Government Property that have been awarded since the prior survey.

Based upon the above criteria, the 4 contract files identified were reviewed for compliance with procedures for providing GFP and/or Installation-Accountable Government Property to a contractor. The review focused specifically upon use of appropriate property clauses, reviews (as applicable) by the Supply and Equipment Management Officer (SEMO), execution (as applicable) of a Determination and Findings (D&F) required under FAR 45.302-1(a)(4) and 1845.302-1(a)(iv) for providing use of Government Facilities, and appropriate NASA Form 507 reporting/FPDS-NG reporting. Note: Out of these 4 files reviewed, it was later discovered that one (1) of the files did not really provide either GFP and/or Installation-Accountable Government Property to a contractor was misidentified on the list of active contracts available for review. This contract (actually a purchase order) basically provided for temporary access to the DFRC facility. As such only three files were reviewed for the compliance. Results of the review were as follows: Documentation of the SEMO review and inclusion of the proper contract clauses were found in all three (3) of the files reviewed; D&F’s documenting the decision to provide use of Government Facilities was included in two (2) of the files (Note: the third file reviewed did not require a D&F because use of Government Facilities was not a requirement); and all of the contracts were appropriately reported on the NASA Form 507 AMS input sheet and/or FPDS-NG form. Other Notes: All of the contracts above required on-site performance as opposed to the GFP being provided to off-site Contractors. As such, these contracts did not require any Property Administration (PA) delegations to DCMA; in addition none of the contracts reviewed required reporting of NASA Property in the Custody of Contractors (i.e. NF-1018 reporting) as they were fixed-price efforts as opposed to being cost-reimbursement contracts. The results of this review indicate a significant improvement over the last survey conducted in 2003.

PIC 01-27 Applicability of Affirmative Procurement provides direction regarding the requirement that all direct purchases of Comprehensive Procurement Guideline (CPG) listed products by NASA civil servants contain recovered material (FAR 23.404(b)) unless a waiver is prepared and distributed in accordance with NPG 8830.1. This PIC requires the contracting officer to ask the request originator how they considered CPG when the procurement mightinvolve an EPA designated item on the CPG. Contracting officers do not need to make this inquiry when FAR clause 52.223-10 is included in the contract. FAR 52.223-10 places the responsibility to use CPG items on the contractor. Two of the three contracts reviewed did not contain FAR 52.223-10, nor did the contract files contain documentation indicating that procurement personnel had complied with the guidance of PIC 01-27.

Clause at 52.223-10, Waste Reduction Program, is required in all contracts for support services at Government-owned or -operated facilities. Five on-site support service contracts were reviewed to determine if they contained the required waste reduction clause, but only one contract contained this clause.

Within DFRC DOP-A-003, FAR/NFS waivers and deviations are mentioned as one of the types of actions that must be coordinated with the DFRC Office of Chief Counsel as deemed necessary by the Acquisition Management Office (AMO). The DFRC procurement files indicated no deviations and waivers had been processed for this survey period. During the survey, the DFRC Procurement Policy Analyst was asked to verify this finding, and confirmed that to his knowledge none had been processed. Further review of the procedures indicated that DFRC has no central repository and no separate work instruction for processing FAR/NFS waivers and deviations. FAR Waivers and deviations require review at the NASA HQ level and approval by the Assistant Administrator for Procurement, thus they may merit a separate instruction.

In the last two internal self-assessments performed at DFRC, both reports discussed the benefits of the HQ VPO and suggested that the procurement staff utilize the VPO more frequently. Based on discussions held with DFRC’s AMO during this procurement management survey, it does not appear that management is encouraging the staff to better utilize the HQ VPO.

SMALL AND DISADVANTAGED BUSINESS (SDB) UTILIZATION

OVERVIEW

The Dryden Flight Research Center’s (DFRC) cutting-edge research activities in aeronautics and space technology are supported by high-tech small and small disadvantaged businesses, whose contributions have often made possible major advancements in the field. Approximately 57.2 % of the Center’s FY 2005 procurement budget was awarded to small and small disadvantaged businesses. The DFRC Small Business Specialist (SBS) ensures that small businesses are provided maximum opportunity to compete for and participate in the Agency’s business initiatives. This section discusses key elements of DFRC’s Small Business Program and the factors associated with its assigned socioeconomic goals.

The Small and Disadvantaged Business Utilization Program is an integral part of the Agency’s business activities. At DFRC, operation of the program resides in the Small Business Office, which is organizationally a part of the Contracting Section of the Acquisition Management Office. Because the Small Business Specialist reports directly to the Deputy Chief of the Acquisition Management Office, his primary responsibilities center on procurement and contract activities. He is, however, also responsible for the day-to-day operation of the small and small disadvantaged business program and manages that office’s workload, which includes reviewing purchase requirements for placement into the Small Business Program, evaluating subcontracting plans, providing counseling and outreach, implementing NPD 5000.2A procedures, ensuring SF 294 and SF 295 reporting, resolving compliance issues, participating in procurement planning, and enhancing the program to make it more responsive to constituent needs.

The DFRC Small Business Specialist is charged with conducting all aspects of the Socioeconomic Program, as directed by regulation and the Assistant Administrator for NASA’s Office of Small and Disadvantaged Business Utilization. Programmatic priorities include (1) counseling both large and small firms wanting to do business with DFRC and advising them on the importance of teaming relationships; (2) engaging in acquisition planning, analyzing statements of work, and providing guidance on small business participation on work packages; (3) monitoring periodic progress and annual results of NASA and prime contractors’ meeting negotiated socioeconomic business goals; (4) providing oversight of prime contractors’ subcontracting programs, to ensure compliance; and (5) participating in a broad range of outreach activities.

In 1995, in its effort to facilitate closer relationships and better communication among DFRC prime contractors and provide a forum for exchanging ideas and discussing issues and concerns, the Acquisition Management Office established the Dryden Contractor Council. Large and small business prime contractors meet monthly to discuss and resolve problems that arise in the execution of their contracts and to share Best Practices and Lessons Learned. The Council is also kept apprised of Agency priorities, that it may be more responsive to Agency needs and, also, to disseminate that information to its own constituent base. Its participation in activities relating to small business--e.g., the NASA Small Business Solutions Conference, which was held in New York City on 1-2 September 2005; DFRC Small Business Forums; the nomination of outstanding companies for Center recognition and awards--is solicited by the DFRC Small Business Office. Moreover, when necessary, the Small Business Office works with the Council to help any of the member companies identify small businesses that can fulfill contractual requirements, the ultimate benefit of which accrues to the Center.

The strong working relationship between the Small Business Specialist and the Site Managers of the Center’s large prime contractors goes a long way towards ensuring that DFRC’s socioeconomic goals are met. The Site Manager for Lockheed Martin, for example, who actively participates on the Dryden Contractor Council and who also functions as the company’s Small Business Liaison Officer at the Center, outsources contractual requirements for technical services (e.g., metrology and calibration services) and equipment (e.g., office supplies) to small businesses whenever possible. She attends NASA-sponsored conferences, including the annual JPL High Tech Conference, and sends information gathered about capable small businesses to other Lockheed Martin entities. Lockheed Martin’s subcontractor on its DFRC Space Shuttle Landing and Research Aircraft Support Service contract is its protégé in the NASA Mentor-Protégé Program, Analytical Services & Materials (AS&M), a Small Disadvantaged Business (SDB) and Woman-Owned Small Business (WOSB).

Except for a shortfall in the HUBZone category for FY 2003, DFRC exceeded its small business prime contractor socioeconomic goals for FY 2003, FY 2004, and FY 2005, in some instances substantially so. As is shown in the table above, the overall SB goals for FY 2004 and FY 2005 were exceeded by 20 percentage points, and achievement of the WOSB goals for FY 2004 and FY 2005 were doubled and quintupled, respectively. The shortfalls noted above were due, in large part, to the difficulty of finding HUBZone businesses that possessed the qualifications necessary to accomplish the required work.

With respect to the SBA’s Small Business Competitiveness Demonstration Program, which targets four industry groups, two of which are construction and architectural & engineering (A&E) services, and in which procurements over $3M are designated Full-and-Open and procurements under $3M Set-Asides, generally for 8(a) companies, DFRC has, in the three years of this reporting period, awarded one Small Business Set-Aside for A&E services to a “local” (Los Angeles) firm.

DFRC reports no bundling of contracts in FY 2003, FY 2004, and FY 2005. Rather, of note is the fact that small businesses are proving capable of competing successfully for contracts that have historically been awarded to large businesses. A case in point is the recently-completed Hyper X contract to build the X-43 aircraft, which was awarded to Microcraft, a WOSB, in Full-and-Open competition.

	Goal 2003	Actual 2003	Goal 2004	Actual 2004	Goal 2005	Actual 2005
Obligations (in $M)	$103.0	$120.4	$118.0	$114.3	$107.0	$133.0
SB (in $M)	$ 53.0	$ 68.3	$ 50.0	$ 77.2	$ 40.0	$ 76.0
SB (in %)	51.5%	56.7%	42.4%	67.6%	37.4%	57.2%
SDB - 8(a) (in $M)	$ 5.5	$ 6.5	$ 6.5	$ 9.8	$ 4.0	$ 6.1
SDB - 8(a) (in %)	5.3%	5.4%	5.5%	8.6%	3.7%	4.6%
SDB - Non 8(a)(in $M)	$ 24.0	$ 36.	$ 23.0	$ 39.5	$ 23.0	$ 32.6
SDB - Non 8(a) (in %)	23.3 %	30.1%	19.5%	34.6%	21.5%	24.5%
WOSB(in $M)	$ 7.5	$ 9.8	$ 6.0	$ 11.4	$ 2.0	$ 16.3
WOSB (in %)	7.3%	8.1%	5.1%	10.0%	1.9%	12.3%
HUBZone (in $M)	$ 2.0	$ 1.5	$ 3.0	$ 3.8	$ 1.0	$ 1.8
HUBZone (in %)	1.9%	1.3%	2.5%	3.3%	0.9%	1.3%

	Goal 2003	Actual 2003	Goal 2004	Actual 2004	Goal 2005	Actual 2005
Total Sub (in $M)	$ 5.0	$ 13.2	$ 5.0	$ 6.0	$ 5.0	*
SB (in $M)	$ 2.5	$ 3.6	$ 2.0	$ 3.0	$ 2.0	*
SB (in %)	50.0%	27.2%	40.0%	50.0%	40.0%	*
SDB (in $M)	$ 1.0	$ .8	$ 1.0	$ 1.6	$ 1.0	*
SDB(in %)	20.0	6.0%	20.0%	26.7%	20.0%	*
WOSB(in $M)	$ 0.2	$ 1.1	$ 0.1	$ 1.0	$ 0.2	*
WOSB (in %)	4.0%	8.2%	2.0%	16.7%	4.0%	8%

* No data available, due to implementation of the new government-wide
electronic Subcontract Reporting System (eSRS).

As can be seen in the table above, DFRC has exceeded--again, in some cases substantially so--its subcontracting goals in each small business category in FY 2003 and FY 2004. The exceptions are the SB and SDB goals for FY 2003, which were affected by the large increase in actual monies spent over projected goal: the total amount expended on FY 2003 subcontracts ($13.2M) was more than two-and-a-half times greater than the $5.0 M goal. For the SB category, the increase in the dollar amount achieved ($3.6M) over dollar amount projected ($2.5M) was not enough to meet the goal in percent of total monies expended, and for the SDB category, which missed the goal in dollar amount achieved, the decrease in percentage points was even greater.

Subcontracting goals are required on all procurements over $500K and over $1M for construction procurements. The Small Business Office reviews all procurement requests, conducts a review of the proposed RFP, and recommends goals for Small Businesses (SB), Small Disadvantaged Businesses (SDB), Women-Owned Small Businesses (WOSB), HUBZone businesses, HBCU and other Minority Institutions (MI), and Service-Disabled/Veteran-Owned Small Businesses (SD/VOSB). Determining appropriate goals is not always easy, as it involves comprehensive market research, consultations with the technical staff, review of SB databases, review by the Small Business Administration (SBA) Procurement Center Representative (PCR), and coordination with the Center’s Small Business Technical Advisor (SBTA). The single most daunting task is breaking down the technical aspects of the work requirements to ascertain what the SB and SDB markets can provide. The SBTA is an invaluable resource here.

PROGRAM MANAGEMENT

1. Procurement Planning

The DFRC Small Business Office’s objective is to be actively involved in reviewing solicitations before they are released, working closely with contracting representatives to determine the status--e.g., Small Business Set-Aside or Full and Open--of upcoming procurements. However, the Specialist is not always involved, or may sometimes be involved too late, in decisions that have to be made regarding new procurement issues. That involvement must occur at the earliest possible date, to enable the Specialist to make valid and effective contributions.

Uniform Methodology for Determining Small Disadvantaged Business Goals

NASA Policy Directive 5000.2A is used to establish a uniform method for determining the Small Disadvantaged Business (SDB) goals to be included in large business solicitations of more than $50M. The goals established are locked in and when the contract is awarded, tracked every six months as well as cumulatively. In addition, reports that contain information pertaining to the NPD 5000.2A activity, such as the number of times the NPD was used in each reporting period, are due to the OSDBU twice yearly.

The DFRC Small Business Office reports that the NPD was not used over the three years in this reporting period--FY2003, FY 2004, and FY 2005--indicating that no procurement meeting the size criterion and requiring SDB goals was let during that time.

SBA Procurement Center Representative

The SBA Procurement Center Representative (PCR) for DFRC has purview over twenty-eight military as well as civilian organizations throughout Southern California, among them the Naval Air Warfare Center at China Lake; Vandenberg Air Force Base in Lompoc; the Corps of Engineers, Los Angeles District; the VA Medical Center in Long Beach; the Naval Surface Warfare Center in Port Hueneme; the Space and Missile Center in El Segundo; and the Air Force Flight Test Center which, with Dryden Flight Research Center, is located at Edwards Air Force Base. The PCR makes quarterly site visits to all twenty-eight organizations, commuting from his office in Glendale, a suburb of Los Angeles. However, he willingly makes himself available to DFRC’s Small Business Specialist whenever requested to do so.

The PCR’s primary function is to obtain more business opportunities for small businesses, to which end he provides DFRC’s Small Business Specialist the support and assistance necessary to establish a cooperative working relationship between the Center and its small business partners. He will, for example, intervene if a small business has problems meeting its contractual obligations and, in fact, has recently done so at the request of the DFRC Specialist, to help a failing 8(a) firm improve its performance to NASA’s satisfaction. He also reviews the Small Business Specialist’s market research prior to concurring on the final decision as to contract type--Full-and-Open or Small Business Set-Aside--and upon request will suggest a number of small companies that are qualified to do the work, having learned about those companies’ capabilities through their technical presentations at various forums. In addition, the PCR is, from time to time, invited do presentations to the DFRC procurement staff to provide pertinent training on small business-related issues.

DFRC’s Small Business Specialist and the PCR work closely on other initiatives as well, such as determining the use of small businesses for purchases under $100 K. When large solicitations (value over $50M) are being developed, the Small Business Specialist and the PCR work jointly to apply NPD 5000.2A procedures to assist the Acquisition Management Office in establishing subcontracting goals. The PCR speaks highly of the DFRC Small Business Specialist, of his knowledge of procurement practices and small business issues, and of his commitment to his work. No Form 70 (appeal from the SBA Administrator to the NASA Administrator) was filed during this three-fiscal-year reporting period, to register the PCR’s objection to any of the Center’s procurement strategies.

STRENGTH

The strong working relationship between the DRFC Small Business Specialist and the SBA PCR benefits the Center, immediately, and the Agency, ultimately. Together, both ensure that business opportunities are available to all categories of small businesses and that information about these opportunities are disseminated widely. Together, also, both ensure that the Center is in compliance with the regulations governing the small business arena.

Center Small Business Technical Advisor

The Small Business Technical Advisor (SBTA) plays a critical role in the SB/SDB program. He/she is the primary consultant to the SBA PCR and the Center Small Business Specialist(s) in determining the extent to which a small or small disadvantaged business can perform the technical requirements of an RFP’s Statement of Work. The SBTA also plays a critical role in implementing the Uniform Methodology for Determining Small Disadvantaged Business Goals (NPD 5000.2A) process.

The DFRC SBTA is also the Program Manager for the Center’s SBIR/STTR Program and the Contracting Officer’s Technical Representative (COTR) for the Pacific Region Technology Transfer Center (RTTC), one of six NASA RTTCs in the country. He provides the DFRC Small Business Specialist invaluable support in helping to evaluate the technical aspects of small business Capability Statements and reports and, by participating in the semi-annual SBS meetings, also provides the Agency’s Small Business Specialists much-needed insight into technical issues relative to small business procurement. Over the three years in this reporting period, the SBTA’s assistance has resulted in (1) a construction contract, the Data Analysis Facility (DAF) Rehabilitation and Modification Contract, being awarded to an SDB HUBZone company that subsequently completed the job ahead of schedule, and (2) an HVAC contract, the Second Rehabilitation and Modification Contract to Building 4800, being changed from Full-and-Open status to 8(a) Set-Aside. The performance of the 8(a) company executing that contract is deemed “outstanding.”

STRENGTH

DFRC’s Technical Advisor, who is always accessible to the Center’s Small Business Specialist, leverages his knowledge about research and technology transfer and his experience in managing the SBIR/STTR Program to broaden the Specialist’s understanding of the interfaces and interconnections between the Agency’s small business programs. Such an understanding may result in shared undertakings, which his willing support of the SBS meetings illustrates.

CONCERN

The DFRC Small Business Technical Advisor will be retiring at the end of this calendar year. DFRC will need to ensure that his successor is equally knowledgeable about small businesses and what they can accomplish, can judge their potential for meeting the Center’s requirements, and will be an advocate for them, thereby helping the Center to meet/exceed its SB goals.

CONCERN

In a highly technical agency such as NASA, where the OSDBU seeks to increase the participation of qualified and capable small businesses, involvement of the SBTA is crucial to the success of the program. However, because the SBTA and SBS are affiliated with different internal organizations, monies to underwrite the SBTA’s participation are generally not available. No line item or charge code exists for this purpose in NASA’s full cost accounting practices. This is a NASA-wide issue.

2. Subcontracting Plans

Subcontracting Plans are required for all contracts exceeding $500,000 in value and for construction contracts exceeding $1Million. In addition, for contracts exceeding $50M in value,

NASA requires that the Uniform Methodology for Determining Small Disadvantaged Business Goals (NPD 5000.2A) be used to determine the percentage of work to be subcontracted to small disadvantaged businesses. As stated above, although the DFRC Small Business Specialist is meticulous about applying NPD 5000.2A to large solicitations, no contract requiring a subcontracting plan was awarded during the three years of this reporting period.

DFRC utilizes such value-added programs as the NASA Mentor-Protégé Program to encourage prime contractors to include small businesses in the execution of large contracts. The benefit to the protégé small business is the guidance and experience that the mentor company provides. Lockheed Martin, t he prime contractor on the large Airborne Science and Shuttle Support Contracts, for example, has for the past three year included its protégé, Analytical Services & Materials, Inc., as one of its subcontractors.

3. Award Fee / Incentive Fee Contracts

Utilizing performance on socioeconomic subcontracting goals as an evaluation factor for contract award and for award fee and incentive fee determinations has proven an effective method for keeping prime contractors “committed” to their relationships with their SB and SDB subcontractors. DFRC conducts semi-annual contract reviews, the findings of which are documented in the Center’s Performance Evaluation Board (PEB) Report. A prime contractor’s meeting its SB and SDB goals is considered a “strength” on the PEB; failure to meet the SB and SDB goals, a “weakness,” generally results in a reduction in award fee. The DFRC Small Business Specialist is not involved in the process of withholding award fee, as the actual function of assessing contract performance on meeting socioeconomic goals resides with the Contracting Officer.

DFRC currently has three Award Fee contracts, one of which is an aircraft maintenance task order on a Johnson Space Center (JSC) contract held by Computer Sciences Corporation. The other two Award Fee contracts are held by two small business primes, Arcata Associates and Analytical Services & Materials, who are evaluated on technical expertise, performance, and cost.

4. Set-Asides

DFRC considers setting aside contracts as Small Business Set-Asides or 8(a) Set-Asides whenever possible, a major determinant for that decision being the competing companies’ capabilities to execute the requirements of the contract. The sizes of these Set-Aside contracts vary, with some being of significant contract value.

Small Business Set-Asides

Small business Set-Asides are used when there are two or more small businesses that can perform the work required in a contract. DFRC awarded 486 small business Set-Aside contracts in the last three fiscal years, which includes SBIR contracts and purchase orders, a number of which were for less than $100,000:

Fiscal Year	SB Set-Asides Awarded	FY Obligations	Total Value of SB Set-Asides *
2003	173	$ 16.2M	$ 38.9M
2004	146	$ 14.7M	$ 31.8M
2005	167	$ 12.7M	$ 38.8M

* “Total Value” in this and the following table excludes
unexercised option year amounts for the respective contracts.

Of note is the fact that DFRC was the first NASA Center to complete a Service-Disabled Veteran Owned Small Business (SDVOSB) Set-Aside procurement, which is for safety, health, and environmental services. SDVOSB was made a Set-Aside category in May 2005.

All contracts between $100 K and $2M (Mid-Range category) are automatically set aside for small businesses if it can be determined that at least two small businesses can fulfill the contract work requirements. NASA discontinued collecting Mid-Range award data in FY 2003.

SBA Section 8(a) Program Set-Asides

DFRC makes awards to 8(a) firms whenever possible. The number and total contract value of 8(a) awards for each of the last three fiscal years are provided in the following table:

Fiscal Year	SBA 8(a) Set-Asides Awarded	FY Obligations	Total Value of SBA 8(a) Set-Asides
2003	5	$ 4.8M	$ 6.5M
2004	7	$ 4.8M	$ 9.8M
2005	5	$ 0.6M	$ 6.1M

5. Reporting

In the past, prime contractors were required to use SF 294 to submit to the Contracting Officer semi-annual reports of subcontracting achievements. The SF 294s were originally submitted in hard copy to the Center’s Contracting Officer, who passed the data to the Small Business Specialists, who, in turn, keyed the data into the Center’s electronic system to create a spreadsheet that allowed comparisons between years. The data were reviewed at the Center and put into a database, and an annual summarization report was then forwarded to Headquarters. This reporting process has recently been simplified: it can now be done online, with the subcontracting data submitted directly into the government-wide electronic Subcontract Reporting System (eSRS). The NASA Small Business Specialists, who are currently being trained to use this reporting system, will serve as their respective Center’s resource persons and points-of-contact, and will be responsible for ensuring that large business prime contractors enter their subcontracting data into the eSRS by the designated due date, as required

OUTREACH

1. Programs

The DFRC Small Business Specialist engages in numerous outreach activities throughout each year, supporting conferences and business expos sponsored by other agencies and organizations as well as holding the Center’s own outreach events. Over the three fiscal years in this reporting period, he has supported outreach activities that include the Navy Gold Coast Conference in Thousand Oaks, CA; the Veteran, Economic& Business Development Conference in Riverside, CA; the Nevada PTAC Federal Marketplace in Las Vegas, NV; the Veteran-Owned Small Business Outreach Conference in Los Angeles, CA; the SBA Business Matchmaking Event in Pasadena, CA; the Minority Enterprise Development (MED) Week Conference in Washington, DC; and the National Veteran Small Business Conference in Las Vegas, NV. NASA events supported include the Annual NASA/JPL High Tech Small Business Conference in Los Angeles, CA; the NASA Small Business Solutions Conference in New York City; the NASA KSC Expo 2004 Small Business Conference at Cape Canaveral, FL; and the NASA SBIR/STTR Program Managers Meeting in Galveston, TX.

DFRC-sponsored outreach events include the 2004 Aeronautics Forum and the 2005 Vendors’ Fair. The former provided five small businesses a forum in which to present their capabilities to the Center’s senior management. The latter, sponsored jointly with Edwards Air Force Base, offered small businesses the opportunity to market their capabilities to potential buyers as well as to other companies with which they might form teaming relationships.

The DFRC Small Business Specialist also provides outreach by participating on panels, such as the panel of Small Business Specialists at the NASA Small Business Solutions Conference, and giving presentations on the Center’s socioeconomic program. He also serves as Chairperson of the Interface Committee of the DOD Western Regional Council for Small Business and as member of its Executive Board, representing NASA at all Council meetings.

STRENGTH:

DFRC’s Small Business Office is to be commended for the support it provides to procurement conferences and expos targeted at providing information and assistance to small and small disadvantaged companies interested in doing business with NASA.

2. Counseling

As DFRC is situated on Edwards Air Force Base, the location of the Small Business Office, in Building 4800 of the Center’s campus, makes in-person counseling sessions somewhat complicated. Interested firms must request a meeting at least 48 hours in advance to satisfy both Air Force and NASA badging requirements and, on the day of the meeting, must pass through the security check points of both organizations. Consequently, companies that request counseling sessions tend to be serious about their marketing efforts and focused on their purpose.

DFRC’s counseling sessions for small businesses are comprehensive in covering pertinent information and address the major items that comprise the OSDBU Uniform Counseling Form. In addition to providing an overview of DFRC’s organizational structure, the Small Business Specialist discusses the procurement process, marketable areas, and the Center’s small business initiatives and programs, and he provides information about upcoming procurement opportunities and procurement points-of-contacts. Individual counseling or one-on-one counseling, is conducted in person, by telephone, or via email, as the occasion requires, and generally focuses on doing business with NASA. The Small Business Specialist also counsels large businesses, though in these cases, the discussion centers on the advantages of their involving small businesses in the DFRC initiatives they support.

SUMMARY

The DFRC Small Business Office’s pro-active outreach activities and the Small Business Specialist’s strong working relationship with the SBA Procurement Center Representative (PCR) and the Site Managers of the Center’s large prime contractors are important factors in the Center’s effort to increase the participation of small and small disadvantaged businesses in its procurement initiatives. Of particular note is the part that the DFRC Contractor Council plays in support of the Center’s Small Business Program.

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JIM BECKER (HQ)	DFRC Survey Team Manager (Organizational Management, Interviews- Procurement Professionals and Technical Customers)
MONICA MANNING (HQ)	Co-Survey Team Manager (Organizational Management, Interviews-Procurement Professionals and Technical Customers)
TOM RUSSELL (HQ)	JOFOC/Competition Advocacy; NASA Form 533 Reporting; CPAF/CPIF contract administration; Contractor Performance Evaluations (NF 1680s); Interagency Agreements; Adequacy of award documentation for Broad Agency Announcements
GENE JOHNSON (HQ)	Self Assessments, Grants/Cooperative Agreements, Waivers/Deviations, Virtual Procurement Office (VPO), Internal Policies and Procedures, Integrated Enterprise Management Program (IEMP) Implementation
DIANE FRAZIER (HQ)	Construction Contracts, Architectural/Engineering Contracts, Environmental Issues, Bank Card Program, Administrative/Office Support Contracts
GAIL SKOWRON (JSC)	Pre- and Post-Negotiation Documentation, Technical Evaluations, Cost/Price Analysis, Progress Payments under Construction Contracts, SBIR Program, 1102 Career Development Training, COTR Delegations/Training, Structured Fee Approach
JIM KITAHARA (NMO at JPL)	Contract Insurance/Pension Reviews, Subcontract Consents, Performance Based Contracting, Synopsis of Contract Awards, Government Furnished Property
ATTILA CSOMA (KSC)	Safety and Health, Simplified/Commercial Acquisitions, Metrics Measurements, Market Research, Exercise of Options, Closeouts and Unliquidated Obligations, Task/Delivery Order (Multiple Award) Contracts
ELEANOR CHIOGIOJI (HQ)	Small Business Utilization/Subcontracting

DONNA SPRINKLE	Headquarters Procurement Data Support
REBEKAH BREWER SUSIE MARUCCI	Headquarters Administrative Support
BRIAN BOWMAN	Dryden Flight Research Center Point of Contact

Procurement
Management
Survey Report

DRYDEN FLIGHT RESEARCH CENTER

December 5 through December 9, 2005

OFFICE OF PROCUREMENT
HEADQUARTERS
WASHINGTON, D.C.

OVERVIEW

ORGANIZATION - MANAGEMENT

PRE - AWARD

POST - AWARD

GRANTS, COOPERATIVE AGREEMENTS, SIMPLIFIED ACQUISITIONS, AND OTHER ISSUES

SMALL AND DISADVANTAGED BUSINESS (SDB) UTILIZATION

OVERVIEW

PROGRAM MANAGEMENT

FY Obligations

Total Value of

FY Obligations

Total Value of

OUTREACH

SUMMARY

Procurement Management Survey Report

DRYDEN FLIGHT RESEARCH CENTER

December 5 through December 9, 2005

OFFICE OF PROCUREMENT HEADQUARTERS WASHINGTON, D.C.

OVERVIEW

ORGANIZATION - MANAGEMENT

PRE - AWARD

POST - AWARD

GRANTS, COOPERATIVE AGREEMENTS, SIMPLIFIED ACQUISITIONS, AND OTHER ISSUES

SMALL AND DISADVANTAGED BUSINESS (SDB) UTILIZATION

OVERVIEW

PROGRAM MANAGEMENT

FY Obligations

Total Value of

FY Obligations

Total Value of

OUTREACH

SUMMARY

Procurement
Management
Survey Report

OFFICE OF PROCUREMENT
HEADQUARTERS
WASHINGTON, D.C.