DFARS Update-Proposed Rules On Past Performance Information Used For Construction and A&E Contract Awards and On Postaward Debriefing Rights and Final Rule On Expedited Contract Closeouts

Last month, on May 20, 2021, the U.S. Department of Defense (DoD) published proposed and final rules under the Defense Federal Acquisition Regulation Supplement (DFARS) covering expedited contract closeouts, the use of subcontractor and joint venturer past performance information for construction and A&E contract awards, and enhanced postaward debriefing rights.  The proposed and final rules are discussed briefly below.

DOD ISSUES FINAL DFARS RULE TO EXPEDITE CONTRACT CLOSEOUTS

On May, 20, 2021, DoD issued a final rule that amends DFARS in order to permit DoD to expedite contract closeouts.  Specifically, the final rule adds a new regulation at DFARS 204.804-70 providing that a contracting officer may include in solicitations and contracts, including contracts valued at or below the simplified acquisition threshold and contracts for commercial items and commercially available off-the-shelf (COTS) items, a new DFARS clause 252.204-7022 whenever the contracting officer intends to expedite the contract closeout process.  Under that new DFAR clause, the contractor and the Government waive entitlement to a residual dollar amount up to $1,000 that either party may be entitled to receive at contract closeout.  The new DFARS rule became effective on May 20, 2021.  To read the final rule, go here.

PROPOSED DFARS RULE REQUIRES USE OF SUBCONTRACTOR AND JOINT VENTURER PAST PERFORMANCE INFORMATION FOR CONSTRUCTION AND A&E CONTRACT AWARDS

On May 20, 2021, DoD proposed to amend DFARS to require the use of past performance evaluations of subcontractors and joint venturers when awarding DoD contracts for construction and architect-engineer (A&E) services.  Specifically, the proposed DFARS rule requires past performance evaluations for first-tier subcontractors performing a portion of construction or A&E services contracts or orders that are valued at or above either the threshold in FAR 42.1502(e), currently $750,000, or 20 percent of the value of the prime contract, whichever is higher.  Past performance evaluations are also required for individual partners of a joint venture for construction or A&E services contract awards or orders valued at or above the threshold in FAR 42.1502(e).  An exception can be granted if the submission of annual past performance evaluations would not provide the best representation of the contractor's performance.  Comments to the proposed rule are due by July 19, 2021.  To read the proposed rule, go here.

DOD PROPOSES TO AMEND DFARS TO PROVIDE ENHANCED POSTAWARD DEBRIEFING RIGHTS

On May 20, 2021, DoD issued a proposed rule that amends DFARS in order to implement changes made by the National Defense Authorization Act for Fiscal Year 2018 (NDAA 2018).  As explained more fully below, the NDAA 2018 changes enhance postaward debriefing rights of defense contractors for competitive negotiated contracts, task orders, and delivery orders that exceed $10 million, provide offerors the opportunity to submit follow-up questions and receive agency responses after a debriefing, and extend the timeframes during which a protest filed with GAO will result in a termination of a contract award or a suspension of contract performance.

Before NDAA 2018, defense agencies and contractors were bound by rules that apply to all federal contractors under FAR 15.506 and FAR 33.104.  With the passage of NDAA 2018 and its expanded protest and debriefing rights, and in the absence of implementing regulations, DoD issued a class deviation implementing some, but not all, of the NDAA 2018 protest and debriefing changes.  As amended by the proposed rule, DFARS will now reflect the following NDAA 2018 requirements for defense agency debriefings.

Required Debriefings
Notwithstanding FAR's rules on required debriefings, a written or oral debriefing is required to be given by defense agencies upon request when a contract award is valued at $10 million or more.

Minimum Required Debriefing Information
In addition to the minimum debriefing information required to be provided to contractors under FAR 15.506(d), for contract awards over $10 million and up to $100 million that are made to small businesses or nontraditional defense contractors, the small business or nontraditional defense contractor has an option to request disclosure of the agency’s written source selection decision document, redacted to protect confidential and proprietary information of other offerors.  For any contract awards over $100 million, the minimum debriefing information required to be disclosed to all contractors shall include the agency’s written source selection document, redacted to protect confidential and proprietary information of other offerors.

Opportunity To Submit Questions After Debriefing
Contracting officers must provide successful and unsuccessful offerors an opportunity to submit additional questions related to a required debriefing within 2 business days after the debriefing, and agencies must respond in writing to timely submitted additional questions within 5 business days after receipt of the questions.

Conclusion of Postaward Debriefing
A postaward debriefing is not considered concluded until after the second business day after the debriefing is conducted if no additional questions are received, or until the agency delivers its written responses to timely submitted additional questions.

Time Periods For Receipt of Notice of GAO Protest Resulting in Contract Suspension or Termination
In lieu of the time periods set forth in FAR, contracting officers generally must immediately suspend performance or terminate an awarded contract, task order, or delivery order upon notice from the GAO of a protest filed within the later of the following time periods -

• Within 10 days after the date a contract is awarded or a task order or delivery order is issued, where the value of the contract or order exceeds $25 million;
• Within 5 days after the date that was offered to an unsuccessful offeror for a debriefing that is requested, and when requested is required, and the unsuccessful offeror submits no additional questions related to the debriefing;
• Within 5 days after the date that was offered to an unsuccessful offeror for a debriefing that is requested, and when requested is required, if the debriefing date offered is not accepted; or
• Within 5 days commencing on the day the Government delivers its written response to additional questions timely submitted by the unsuccessful offeror, when a requested and required debriefing is held on the date offered.

Comments to the proposed rule are due by July 19, 2021.  To read the proposed rule, go here.