[Code of Federal Regulations]

[Title 48, Volume 4]

[Revised as of October 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR315.372]



[Page 39-40]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                  CHAPTER 3--HEALTH AND HUMAN SERVICES

 

PART 315_CONTRACTING BY NEGOTIATION--Table of Contents

 

                     Subpart 315.3_Source Selection

 

Sec. 315.372  Preparation of negotiation memorandum.



    The negotiation memorandum or summary of negotiations is a complete 

record of all actions leading to award of a contract and is prepared by 

the contract negotiator to support the source selection decision 

discussed in FAR 15.308. It should be in sufficient detail to explain 

and support the rationale, judgments, and authorities upon which all 

actions were predicated. The memorandum will document the negotiation 

process and reflect the negotiator's actions, skills, and judgments in 

concluding a satisfactory agreement for the Government. Negotiation 

memorandums shall contain discussion of the following or a statement of 

nonapplicability; however, information already contained in the contract 

file need not be reiterated. A reference to the document which contains 

the required information is acceptable.

    (a) Description of articles and services and period of performance. 

A description of articles and services, quantity, unit price, total 

contract amount, and period of contract performance should be set forth 

( if Supplemental Agreement--show previous contract amount as revised, 

as well as information with respect to the period of performance).

    (b) Acquisition planning. Summarize or reference any acquisition 

planning activities that have taken place.

    (c) Synopsis of acquisition. A statement as to whether the 

acquisition has or has not been publicized in accordance with FAR 

Subpart 5.2. A brief statement of explanation should be included with 

reference to the specific basis for exemption under the FAR, if 

applicable.

    (d) Contract type. Provide sufficient detail to support the type of 

contractual instrument recommended for the acquisition. If the contract 

is a cost-sharing type, explain the essential cost-sharing features.

    (e) Extent of competition. The extent to which full and open 

competition was solicited and obtained must be discussed. The discussion 

shall include the date of solicitation, sources solicited, and 

solicitation results. If a late proposal was received, discuss whether 

or not the late proposal was evaluated and the rationale for the 

decision.

    (f) Technical evaluation. Summarize or reference the results 

presented in the technical evaluation report.

    (g) Business evaluation. Summarize or reference results presented in 

the business report.

    (h) Past performance. Summarize or reference results of past 

performance evaluation and reference checks.

    (i) Competitive range (if applicable). Describe how the competitive 

range was determined and state the offerors who were included in the 

competitive range and the ones who were not.

    (j) Cost breakdown and analysis. Include a complete cost breakdown 

together with the negotiator's analysis of the estimated cost by 

individual cost elements. The negotiator's analysis should contain 

information such as:

    (1) A comparison of cost factors proposed in the instant case with 

actual factors used in earlier contracts, using the same cost centers of 

the same supplier or cost centers of other sources having recent 

contracts for the same or similar item.

    (2) Any pertinent Government-conducted audit of the proposed 

contractor's record of any pertinent cost advisory report.

    (3) Any pertinent technical evaluation inputs as to necessity, 

allocability and reasonableness of labor, material and other direct 

expenses.

    (4) Any other pertinent information to fully support the basis for 

and rationale of the cost analysis.

    (5) If the contract is an incentive type, discuss all elements of 

profit and fee structure.

    (6) A justification of the reasonableness of the proposed 

contractor's estimated profit or fixed fee, considering the requirements 

of FAR 15.404-4 and HHSAR 315.404-4.

    (k) Cost realism. Describe the cost realism analysis performed on 

proposals.

    (l) Government-furnished property and Government-provided 

facilities. With respect to Government-furnished or Government-provided 

facilities, equipment, tooling, or other property, include the 

following:



[[Page 40]]



    (1) Where no property is to be provided, a statement to that effect.

    (2) Where property is to be provided, a full description, the 

estimated dollar value, the basis of price comparison with competitors, 

and the basis of rental charge, if rental is involved.

    (3) Where the furnishing of any property or the extent has not been 

determined and is left open for future resolution, a detailed 

explanation.

    (m) Negotiations. Include a statement as to the date and place 

negotiations were conducted, and identify members of both the Government 

and contractor negotiating teams by area of responsibility. Include 

negotiation details relative to the statement of work, terms and 

conditions, and special provisions. The results of cost or price 

negotiations must include the information required by FAR 31.109 and 

15.406-3. In addition, if cost or pricing data was required to be 

submitted, the negotiation record must also contain the extent to which 

the contracting officer relied upon the factual cost or pricing data 

submitted and used in negotiating the cost or price.

    (n) Other considerations. Include coverage of areas such as:

    (1) Financial data with respect to a contractor's capacity and 

stability.

    (2) Determination of contractor responsibility.

    (3) Details as to why the method of payment, such as progress 

payment, advance payment, etc., is necessary. Also cite any required D & 

F's.

    (4) Information with respect to obtaining of a certificate of 

current cost or pricing data.

    (5) Other required special approvals.

    (6) If the contract represents an extension of previous work, the 

status of funds and performance under the prior contract(s) should be 

reflected. Also, a determination should be made that the Government has 

obtained enough actual or potential value from the work previously 

performed to warrant continuation with the same contractor. (Project 

officer should furnish the necessary information.)

    (7) If the contract was awarded by full and open competition, state 

where the unsuccessful offerors' proposals are filed.

    (8) State that equal opportunity provisions of the proposed contract 

have been explained to the contractor, and it is aware of its 

responsibilities. Also state whether or not a clearance is required.

    (9) If the contract is for services, a statement must be made, in 

accordance with FAR 37.103, that the services to be acquired are 

nonpersonal in nature.

    (o) Terms and conditions. Identify the general and special clauses 

and conditions that are contained in the contract, such as option 

arrangements, incremental funding, anticipatory costs, deviations from 

standard clauses, etc. The basis and rationale for inclusion of any 

special terms and conditions must be stated and, where applicable, the 

document which granted approval for its use identified.

    (p) Recommendation. A brief statement setting forth the 

recommendations for award.

    (q) Signature. The memorandum must be signed by the contract 

negotiator who prepared the memorandum.