Procurement Information Circular

December 5, 2008


PURPOSE:   To encourage contracting officers (COs) to conduct discussions to the extent appropriate with offerors determined to be in the competitive range.

BACKGROUND:  FAR 15.306(d) provides that exchanges with offerors after establishment of the competitive range are negotiations.  FAR 52.215-1 allows for award on initial proposals without any discussions, but the clause also “reserves the right to conduct discussions if the Contracting Officer later determines them to be necessary.”  It appears there may have been cases when contracts awarded based on initial proposals did not result in NASA attaining the best value.  Reasons given for awarding without discussions include:  FAR 52.215-1(f)(4) gives the CO the discretion to award without discussions, concerns about technical leveling, concerns about technical transfusion, and concerns that the acquisition process will be lengthened.  The determination to make an award on initial proposals should only be made when the Government believes it can obtain best value without discussions from the offerors’ initial proposals.  This basically entails accepting the proposal “as is”, inclusive of any weaknesses and at the offeror’s proposed contract value.  Openness with offerors during discussions to the maximum practicable and legally permissible extent should be encouraged in order to ensure that competition is maximized, the Government negotiates the best value it can and selects an offeror who can provide the most predictable, reliable, and most successful contract performance and outcomes. 

GUIDANCE:  Contracting officers are encouraged to conduct discussions with all offerors determined to be in the competitive range whenever the general conditions for making award on initial proposals have not been met (See “Reasons to Award on Initial Proposals and Not Conduct Discussions” below).    

Applicable procurement regulations

·        FAR 15.306(d) and NFS 1815.306(d) “Exchanges with offerors after establishment of the competitive range”;

·        FAR 15.307 and NFS 1815.307 “Proposal Revisions”; and

·        FAR 52.215-1 “Instructions to Offerors--Competitive Acquisition”.

Purpose and Fundamentals of Discussions

   Exchanges with offerors in the competitive range are called “discussions.”  The primary objective of discussions is to maximize the Government’s ability to obtain best value based on the requirements and the evaluation factors set forth in the solicitation.  These “discussions” afford the Government an opportunity to effectively understand and evaluate an offeror’s proposal, permit offerors an opportunity to clearly explain aspects of their proposal, and revise their proposals accordingly. 

   The scope and extent of discussions are a matter of CO judgment.  However, once a CO determines the Government’s position will be improved by conducting discussions with any one of the offerors, the CO must conduct discussions with all offerors determined to be in the competitive range, following which all offerors in the competitive range are to have an opportunity to submit a proposal revision.  Whatever the extent of the discussions, it is fundamental to negotiated procurement that discussions must be meaningful, equitable/fair, and not misleading.  

   For discussions to be meaningful, they must be in sufficient detail so as to lead an offeror into the areas of its proposal requiring amplification or revisions.  The CO must identify to the offerors all evaluated deficiencies and significant weaknesses, and the CO is encouraged to identify other aspects in each offeror’s proposal that can reasonably be addressed or explained so as to materially enhance the offeror’s potential for receiving a contract award.  In addition, the Government must identify any adverse past performance information to which the offeror has not had an opportunity to respond.

   The requirement that discussions be equitable and fair does not require the CO to discuss every area where an offeror’s proposal could be improved.  In addition, the discussions with each of the offerors do not have to be identical and shall be tailored to each offeror’s unique proposal.  The CO shall identify those aspects of the offeror’s proposal that clearly limit an offeror’s award potential.  The CO should use the SEB’s evaluation findings that apply to each offeror to conduct discussions.  More time for discussions may be required with offerors whose proposal contains a greater number of significant weaknesses or deficiencies.

   Discussions cannot be misleading.  During discussions, COs must be careful not to mislead an offeror by communicating in a manner that does not address the agency’s concerns, findings, or misinforms the offeror concerning a problem with its proposal or about the Government’s requirements.  The CO just needs to lead offerors into the areas of their proposal that require amplification, revision, or correction. 

   The CO should seek the advice of Legal Counsel prior to conducting discussions with offerors on how to conduct fair and meaningful discussions so as to minimize the potential for litigation and prevent, if possible, weaknesses that could have been identified and corrected but were not.

Oral and/or Written Discussions

   Discussions may be either oral or written, but if the deficiencies and uncertainties are numerous and complicated, it may be appropriate to use both oral and written discussions.  Oral discussions may be more efficient than written discussions.  If oral discussions are conducted, the same format should be used with each offeror to ensure integrity and fairness in the acquisition process.  However, as discussed above, the Government does not have to spend equal time with all offerors or discuss the same areas.  More time may be required with offerors whose proposal contains a greater number of significant weaknesses or deficiencies.

Although there is less chance of inadvertent modification of the solicitation requirements when written discussions are conducted, the use of oral discussions is encouraged because oral discussions result in better communication and interaction.  Face-to-face negotiations after sending written questions, receiving, and reading each offeror’s responses is one of the best ways to have meaningful discussions, however, discussions also may be conducted via video teleconferences.  The CO should establish an agenda and uniformly-applied ground rules for all participants during the oral discussions.  The agenda and ground rules should be delivered to the offerors and Government participants in advance.   The CO should document all discussions.   

COs can identify weaknesses and deficiencies to offerors in a variety of ways:  as written in the evaluation team’s documentation/findings or by rewriting the documentation/findings into the form of a question or statement about the significant weakness or deficiency, or a combination of both.  The CO should ensure questions or statements are direct, but do not lead the offeror to a desired result or elicit a substantive response from the offeror.  An example of turning an evaluation team’s significant weakness/finding into a question or statement to be given to an offeror for discussion is as follows:

         Evaluated Significant Weakness Finding:  The proposal failed to identify critical issues involved with the phase-in/transition effort of the resultant contract.  In addition, the offeror’s proposal only minimally identified the risks in transition and the mitigation strategies to be used and so failed to demonstrate an understanding of the challenges in staffing a contract of this size, scope, and complexity.  Therefore, the Government has a low level of confidence that the offeror can achieve a successful contract transition/phase-in.

         Question or Statement Developed about the Significant Weakness:  The proposal failed to identify critical issues involved in the phase-in or transition effort of this contract.  In addition, the proposal only minimally identified the risks in transition and the mitigation strategies to be used and so failed to demonstrate an understanding of the challenges in staffing a contract of this size, scope and complexity.  STATEMENT OPTION - Please address this significant weakness of your proposal as you deem necessary to enhance materially your proposal’s potential for award.  QUESTION OPTION – What processes and staffing will you use to minimize transition risks and mitigate the risk that the transition with not occur as and when required?


Reasons to Award on Initial Proposals and Not Conduct Discussions

   The CO should include FAR Clause 52.215-1 Instructions to Offerors-Competitive Acquisitions in competitive solicitations where the Government intends to award a contract without discussions with offerors.  The clause serves to notify the offeror that their proposal should contain the offeror’s best terms and that the Government reserves the right to conduct discussion if they are determined by the CO to be necessary.  CO should determine whether discussions are necessary only after proposals are received and evaluated.  Decisions to not have discussions should be made on a case-by-case basis.  Examples where it may not be necessary for there to be discussions include:  mature production programs, routine procurements with well-defined requirements and a number of qualified vendors, and an acquisition for spare parts.  However, Contracting Officers are encouraged to have discussions when it is prudent and makes sense to do so. 

   The following general conditions, while not mandatory, should be considered as part of making a decision that discussions are not necessary and it is in the best interest of the Government to make the award on an offeror’s initial proposal:

         (1) There is a clear “winner” based on the offeror’s initial proposal.  The Government should believe the offeror’s initial proposal represents the best value to the Government and it is unlikely discussions would make an another offeror’s proposal a better value or more eligible for award; and

         (2) The apparent ‘winning” proposal must be of such a quality that the Government can accept the proposal without having to pursue any changes to the contract requirements, terms, or conditions.  There should be no known significant weaknesses (any weaknesses identified are few, minor, and easily correctable), or deficiencies that require correction before award or known ambiguities that should be more clearly understood by the Government.  The proposed contract value should be realistic, reasonable, and within budgetary/funding limitations or constraints.  The proposal should not contain any proposed exceptions or deviations to contract clauses that are unacceptable to the Government.

   When planning an acquisition, contracting officers are reminded to include sufficient time in their schedules in case it is determined that discussions are needed. 

EFFECTIVE DATE: This PIC is effective as dated and shall remain in effect until canceled or superseded.

HEADQUARTERS CONTACT:  Marilyn J. Seppi, Contract Management Division; 202-358-0447, email:  marilyn.seppi-1@nasa.gov.



James A. Balinskas
Director, Contract Management Division