PSC Welcomes Final IDIQ Pricing Rule

Arlington, Va. (July 9, 2020) The Professional Services Council (PSC) welcomes the publication of a final rule to modify cost and pricing requirements for certain multiple-award task-order contracts. The Federal Acquisition Regulation (FAR), released on July 2, 2020, modifies how and when certain pricing information is collected by the Department of Defense, NASA and the Coast Guard. 

“This rule allows contracting officers to better evaluate solutions, capabilities and performance by shifting the timing of the submission of certain cost and pricing requirements when individual task orders are issued and competed,” said PSC’s Executive Vice President and Counsel Alan Chvotkin. “The government gets limited, if any, value by focusing on price during source selection of indefinite delivery/indefinite quantity (IDIQ) contracts. The government, the contractor community and the taxpayer will benefit from the changes made in this final rule.”  

This final rule implements Section 825 of the Fiscal Year 2017 National Defense Authorization Act (NDAA), which exempts buying activities at certain federal agencies from evaluating cost or price during evaluation of the formation of a multiple-award, IDIQ contract, provided other conditions are met. If cost or price is not evaluated at formation, cost or price must be an evaluation factor with the issuance of any task or delivery order under such awarded contract. This rule does not apply to solicitations for multiple-award contracts that provide for sole-source orders to small businesses.

“PSC strongly supported the modifications made to this non-value added and burdensome requirement by the FY17 NDAA, although the provision only applies to DoD, NASA and the Coast Guard. We are now working on a proposal that would expand this requirement government-wide so all federal agencies can focus on enhancing value and incentivizing innovation, while evaluating price at the appropriate time,” Chvotkin stated.
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