Thursday, April 26, 2012

Justification and Approval (J&A)

Earlier this week, we reported on the final rule that prohibits the Government from awarding any contract greater than $20 million under the SBA's 8(a) Business Development Program without first obtaining written justification. This written justification, known as J&As (Justification and Approval) in the trade, must be made publicly available for at least 30 days. The Government has chosen to post these J&As on FedBizOpps. Actually, this final rule replaces an interim rule from nearly year ago so these J&As have been available for some time. We decided to take a look at some of them and here are a few observations.

While there are dozens of J&As posted to FedBizOps, we were unable to locate any that were for $20 million plus awards to 8(a) firms. Perhaps there are not that many.

The key to a sole source justification is to demonstrate that the contractor has some kind of unique qualification. Many J&As were for spare parts that only the manufacturer of the full product can deliver. Those justifications are fairly obvious. However, the documentation for many seemed vague. "Expediency" was often used as justification.

Even in sole source procurement, the Government must determine that the price or cost is fair and reasonable. Since these justifications are prospective, the contracting officer has usually not yet determined price reasonableness. So, the J&A typically states that the contracting officer will determine, though various available means, analyses, and comparisons, that the price is reasonable.

The "quality" of J&As varies by Agency. Some are bereft of information and details while others go to great lengths to justify their decision and action. In either case, we were often left wondering about the sufficiency of the justification.

Most of the J&As we looked at included a section describing the Government's planned actions to remove barriers to future competition. In most cases, the Agency offered no substantive plans to further competition for the products being purchased.

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