Contractor Purchasing Systems - Source Selection Considerations

FAR (Federal Acquisition Regulations) 52.244-2 requires prime contractors to provide contracting officers notification before the award of many subcontract and to obtain contracting officer consent to subcontract. See Government's Consent to Subcontract for more information on this subject. The objective of requiring consent to subcontract is to evaluate the efficiency and effectiveness with which the contractor spends Government funds and complies with Government policy when subcontracting.

With this in mind, Government agencies have devised a variety of checklists they use when reviewing contractor notification and consent packages. One of the most important aspects in determining contractor compliance with Government policy is in the source selection process. Following is a compendium of items taken from several of those checklists. Contractors would do well to ensure that their own purchasing systems address these areas.

• Adequately address make-or-buy considerations.
• If procurement is from a contractor-controlled source, provide adequate justification.
• Consider soliciting labor surplus areas and small business sources, including small business owned and controlled by disadvantaged individuals.
• Compliance with contract requirements regarding small business subcontracting, including, if applicable, plans for subcontracting with small, veteran-owned, service-disabled veteran-owned, HUBZone, small disadvantaged and women-owned small business concerns.
• Agreement to provide progress payments on fixed-price subcontracts with small business concerns in conformity with FAR 32.502-3 and not consider such payments as an adverse factor in selection.
• Ensure adequate price competition or properly justify the absence of adequate price competition.
• Ensure a sound basis for determining the responsibility of a particular subcvontractor.
• Ensure that the proposed subcontract type is appropriate for the risks involved and consistent with current policy.
• Ensure that the proposed subcontract does not appear on the Excluded Parties List System (see FAR 9.404).
• Ensure that OCI (Organization Conflicts of Interest) analysis has been performed.