I n the previous article in this series, we discussed Indefi- nite Delivery Type Contracts (IDTCs) and the regulatory preference for using multiple award contracts when awarding Indefinite Delivery Indefinite Quantity (IDIQ) con- tracts. A primary advantage of this approach is that competition continues into the actual ordering process.
Before this preference for multiple awards emerged, agencies would routinely compete and award an IDIQ to only one company. All or- ders we placed against that contract were to that single source; we didn’t have competitive forces in play to help control cost or price at the order level. Thus, the emphasis on mul- tiple award contracts arose. This is especially important in contracts for services, wherein different compa- nies may have different approaches and varying labor rates for particular tasks that arise. These multiple award contracts for services are sometimes called Multiple Award Task Order Contracts, or MATOCs. As with many things in contract- ing, the rules about ordering under MATOCs have evolved over the years. When use of these procedures first arose, it was considered a way to streamline the acquisition pro- cess, and the contracting office had significant flexibility to implement the procedures. Over time, the rules have become increasingly formalized. This is often due to the influence of indus- try and the (perhaps erroneous) belief that agencies have used their discre-
tion too freely. This ar- ticle focuses on the current regulatory procedures. (See
the included Historical Perspective for more information on this evolution.) Fair Opportunity Ordering FAR 16.505 describes procedures for ordering under IDIQs. Paragraph (a) provides general information for orders under all types of IDTCs. Among other things, we usually do not have to synopsize orders under IDTCs. This is a huge time saver. Yet we must still clearly describe what we are purchasing in terms of perfor- mance-based acquisition methods, if applicable, and follow special rules if we are ordering items specific to one manufacturer. The FAR guidance also lists minimum information that must be included in all orders under IDTCs. But more specifically, orders under multiple-award IDIQs are discussed in FAR 16.505(b), which mandates the use of “fair opportunity” procedures. What constitutes fair opportunity var- ies depending on the dollar value of the transaction being competed. As you would expect, the higher the dol- lar value, the more extensive the effort
needs to be. Certain
things are standard. First, the con- tracting officer who establishes the multiple award contracts has the discretion to develop procedures for use in placing orders. The goal is to minimize paperwork and administra- tive effort but also provide for good competition (remember the guiding principles ). The procedures established when the contracts are awarded must provide each awardee a fair opportu- nity to be considered for each order, use no allocation method that favors any one company, and consider price or cost as an evaluation factor when placing any order. These ordering procedures must be included in the solicitation and contracts for the mul- tiple award contracts. If an anticipated order is over the micro-purchase threshold (MPT)— currently $10,000 for most actions— but does not exceed the simplified ac- quisition threshold (SAT)—currently $250,000 for most actions—the
Before this preference for multiple awards emerged, agencies would routinely compete and award an IDIQ to only one company. All orders we placed against that contract were to that single source; we didn’t have competitive forces in play to help control cost or price at the order level.
38 | DEFENSE ACQUISITION | May-June 2025
Made with FlippingBook - Online Brochure Maker