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(a) Under section 31 of the Arms Control and Disarmament Act (22 U.S.C. 2571), the Director, in carrying out his responsibilities, is authorized "to make arrangements (including contracts, agreements, and grants) for the conduct of research, development, and other studies in the field of arms control and disarmament by U.S. private or public institutions or persons." This authority is initially exercised under the Federal Property and Administrative Services Act of 1949, as amended, and under the Federal Procurement Regulations issued by the General Services Administration pursuant thereto. Except under certain circumstances set forth in those regulations, Government contracts for supplies and services are required to be made only after formal advertising and competitive bidding. The purpose is to give all qualified persons an equal opportunity to compete for Government contracts; to avoid favoritism or collusion in the letting of contracts; and, most important of all, to increase the Government's chances of finding the particular organization or individual who will best supply the Government's needs for supplies or services, price, and other factors considered.

(b) For the same reasons, where formal advertising for bids is determined to be impracticable, as may be the case with Agency research contracts, the requirement for negotiated contracts resulting from competitive proposals obtains. The proposals must be obtained from all known qualified sources and the procurement opportunity synopsized to assure maximum full and free competition consistent with the needs of the Government.

(c) Accordingly, the Agency normally procures research services by sending out a request for proposals to a number of possible sources ascertained to have qualifications in the particular area of service concerned. These requests for proposals are announced in the "United States Department of Commerce Synopsis of U.S. Government Proposed Procurements, Sales, and Contract Awards,” in accordance with the provisions of 15 U.S.C. 637, for the information of any potential offeror. However, certain procurements need not be so announced,

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A Contractor Selection Board, whose membership is approved by the Director, is established for each prospective contract for which competitive proposals are to be solicited.

§ 23-3.150-2 Evaluation of proposals.

(a) In evaluating proposals, unless otherwise set forth in the Request for Proposal, the Board shall give primary and equal consideration to (1) the degree of initiative and imagination displayed, (2) the caliber and experience of the personnel involved, and (3) the soundness of the offeror's approach.

(b) After elimination of proposals on the basis of the foregoing, then price and other factors in relation to the work to be performed will be considered for purposes of final selection.

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§ 23-3.150-5

Restriction on disclosure of Contractor Selection Board Reports.

Because of the confidential nature of information supplied by the offeror(s) and of the evaluations contained in the Contractor Selection Board's report, the report shall not be made available to the public.

Subpart 23-3.2-Circumstances

Permitting Negotiation

§ 23-3.202 Public exigency.

Pursuant to section 302(c) (2) of the Federal Property and Administrative Services Act (41 U.S.C. 252(c) (2)), purchases and contracts may be negotiated if: "the public exigency will not admit of the delay incident to advertising." § 23-3.202-50 Application.

Examples of circumstances when use of the authority cited in § 23–3.202 may be justified include the following:

(a) Specialized studies to support elements of arms control proposals being considered urgently for international negotiations.

(b) Development or production of verification equipment urgently needed to support obligations assumed by the United States under executive agreement or treaty.

§ 23-3.204 Personal or professional services.

Pursuant to section 302(c) (4) of the Federal Property and Administrative Services Act (41 U.S.C. 252(c) (4)), purchases and contracts may be negotiated if "for personal or professional services."

§ 23-3.204-50 Application.

(a) This authority shall be used when the following conditions have been satisfied:

(1) If personal services. they are required to be performed by an individual contractor in person (not by organization or other association) and are to be performed under Government supervision and paid for on a time basis.

(2) If professional services, they may be performed either by an individual person or by an association.

(3) Procurement of the services is authorized by law and is effected in accordance with the requirements of any such law.

(b) Under section 41(d) of the Arms Control and Disarmament Act (22 U.S.C. 2581), the Agency is authorized to: Procure services of experts and consultants or organizations thereof, including stenographic reporting services, as authorized by section 15 of the Act of August 2, 1946 (5 U.S.C. 3109(b)), at rates not to exceed $100 per diem for individuals, and to pay in connection therewith travel expenses of individuals, including transportation and per diem in lieu of subsistence while away from their homes or regular places of business, as authorized by section 5 of said Act, as amended (5 U.S.C. 5703): Provided, That no such individual shall be employed for more than 100 days in any fiscal year unless the President certifies that employment of such individual in excess of such number of days is necessary in the national interest: And provided further, That such contracts may be renewed annually;

(c) 5 U.S.C. 3109(b), in turn, provides authority to procure by contract: The temporary (not in excess of 1 year) or intermittent services of experts or consultants or an organization thereof, including stenographic reporting services. § 23-3.204-51


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(2) A base fee commensurate with minimum acceptable performance;

(3) Criteria against which the contractor's performance will be evaluated;

(4) An additional adjustment to the base fee, not to exceed a stipulated maximum, which is awarded on the basis of the subjective evaluation by ACDA of contractor performance; and

(5) Specific provision that the determination of fee adjustment shall not be subject to the contract article entitled "Disputes".

(b) Application. The cost-plus-awardfee contract is suitable for use when:

(1) A cost-reimbursement-type contract is found necessary or particularly pertinent;

(2) The work to be performed is such that specific quantitative or objective measurement is not feasible and effective incentive arrangements cannot be devised on the basis of cost or performance (see § 1-3.405-4 of this title).

(3) Agency procurement objectives will be advanced if the contractor is effectively motivated to exceptional performance; and

(4) Any added administrative effort and costs required to monitor and evaluate performance are justified by the anticipated benefits.

(c) Considerations of concept. (1) The opportunity for increase in earned fees is intended to motivate the contractor to manage effectively the required work, to control costs, and to improve the timeliness, quality, and quantity of performance.

(2) The award fee should be earned by the contractor for exceptional performance, surpassing minimum acceptable levels and should be commensurate with the benefits accruing to the Agency from the contractor's performance. The contractual terms may generally obligate the contractor to devote a specified level of effort for a stated period of time to satisfy the various aspects of the scope of the work; it follows that the award of additional fee for exceptional performance in designated areas should be contingent upon an acceptable level of performance for all other contract requirements. Although determination of the amount of award fee is a unilateral one based on subjective evaluations, the decision may be aided by such quantifying devices as adjectival ratings, point systems or percentages of achievement. Ordinarily, the award fee adjustments will be increases only, and contract arrangements for decreases in base fee (e.g., if certain criteria or levels of performance are not met) must be carefully scrutinized prior to approval for use. Such arrangement must provide that the contractor will be informed of the reasons for decrease in fee, and will be given specific opportunity to submit information on his behalf prior to decision by the official responsible for fee adjustment.

(d) Limitations. (1) The cost-plusaward-fee contract shall not be used (i) in procurements in which all factors affected by the incentive (e.g., cost, delivery, or performance) can be measured or objectively evaluated, or (ii) where the contract amount, term of performance or anticipated benefits are insufficient to warrant the additional administrative effort or cost.

(2) The maximum fee, comprising base fee, award fee and any other incentive fee payable under the contract may not exceed the maximum fee prescribed by law or regulation for research and development, or for supply contracts. Subpart 23-3.50-Solicitation of Proposals and Quotations

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Mail showing a legible, dated postmark and to retain such receipt against the chance that it will be required as evidence that a late proposal was timely mailed.

(c) Proposals which are received in the office designated in the requests for proposals after the time specified for their submission are "Late Proposals". Unless a specified time for receipt of proposals is stated in the request for proposals, the time for such receipt shall be deemed to be the time for close of business of the office designated for receipt of proposals on the date stated in the request for proposals. Late proposals shall not be considered for award, except under the following circumstances:

(1) Only one proposal is received; or (2) Under the circumstances set forth in § 1-2.303 of this title permitting consideration of late bids if proven to have been timely mailed or timely filed with the telegraph company.

(d) When it has been determined that a late proposal will not be considered for award, the offeror shall be notified promptly of the fact.

(e) Late modifications shall be subject to the rules applicable to late proposals set forth in this section. The normal revisions of proposals by selected offerors occurring during the usual conduct of negotiations with such offerors are not to be considered as late proposals or late modifications.

(f) All the provisions of this section are equally applicable to late quotations. § 23-3.5002 Treatment of procurement information.

§ 23-3.5002-1 Restrictions on disclosure and use of data in proposals and quotations.

(a) (1) A proposal, whether solicited or unsolicited, may include data, such as a technical design or concept or financial and management plan, which the offeror does not want disclosed to the public for any purpose or used by the Government for any purpose other than evaluation of the proposal. If an offeror wishes so to restrict his proposal, he shall mark the title page with the following legend:

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If proposal is unsolicited, delete "furnished in connection with Request for Proposals No.

(2) The offeror shall mark each sheet of data which he wishes to restrict with the following legend:

Use or disclosure of proposal data is subject to the restriction on the Title page of this proposal.

are SO

Contracting Officers and other Agency personnel shall not refuse to consider any proposal merely because it or the data submitted with it is so marked. Those portions of the proposal and data which marked (except for information which is also obtained from another source without restriction) shall be used only to evaluate the proposal and shall not be disclosed outside the Government without the written permission of the offeror. If it is desired to duplicate, use, or disclose the data of the offeror to whom the contract is to be awarded, for purposes other than to evaluate the proposal, the contract should so provide. (See Part 23-52 of this chapter for a description of "data" and, in general, for the policy, instructions, and contract clauses with respect to the acquisition and use of data.)

(b) Proposals of subcontractors which are included as part of a proposal submitted by a prime-offeror shall be marked as provided in paragraph (a) of this section if the subcontractor wishes so to restrict his proposal.

(c) The provisions in paragraphs (a) and (b) of this section are also applicable to quotations. In the case of a request for quotations, the legends in paragraph (a) of this section shall be appropriately modified.

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A limited exception to the general requirement of competition in Government procurement arises in connection with unsolicited proposals. When a proposal for services has been submitted by an offeror upon his private initiative, it might not be equitable for the Agency to seek competing proposals. Because the considerations here are equitable in nature, the determinations must depend on consideration of the facts of each case and the extent to which the inequity to the proposing party is so great that the Government may be limited in the method of procurement. Several guiding principles can be stated:

(a) An unsolicited proposal must be truly unsolicited, and not the result of formal or informal requests for proposals made by Agency representatives.

(b) An unsolicited proposal should not merely anticipate a particular research project. Thus, for example, an offeror reading the Congressional report of hearings on the Agency's appropriation and quickly submitting a proposal on a project which the Agency clearly contemplated undertaking by contract during the fiscal year in question, does not meet valid criteria governing unsolicited proposals.

(c) An unsolicited proposal should represent a considerable investment of time and effort by the offeror. Thus, in order to qualify for a contract negotiated without competition, an unsolicited proposal should be an unusual, detailed, original, thoroughly developed conception of a project, which could result in furthering the Agency's statutory responsibilities. (See § 23-3.5002-1 of this

chapter for protection of proprietary data contained in proposals.)

§ 23-4.5103 Procedures.

(a) Each unsolicited proposal shall be examined in detail, the facts evaluated in light of the equities involved, and documentation of the factors considered in such evaluation retained. Contracting for research, development or studies on the basis of unsolicited proposals may be undertaken only after the following steps are taken:

(1) The designated representative of the Bureau or Office most likely to sponsor the work by reason of its responsibilities, considers, coordinates, analyzes, and evaluates the proposal.

(2) If the unsolicited proposal is deemed to be worthy of sponsorship by the Bureau or Office head, he shall submit a memorandum to the Research Council (see 22 CFR 603.14) recommending that the research should be conducted under a contract.

(3) If the Research Council approves the proposal, it is referred to the Director for his authorization of negotiation of the contract.

(b) When an unsolicited proposal has been determined to be unacceptable, the Bureau or Office head will notify the offeror in writing of this fact and the reasons therefor.

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