Emergency Contracting Toolkit

 

In the aftermath of major events, federal agencies need to be able to acquire goods and services quickly to aid in the recovery. Emergencies such as this trigger a variety of changes and a lot of flexibility in the federal contracting process. Those responsible for doing the contracting must have the know-how and tools to react quickly to acquire critical supplies and services.

 

Many organizations, both government and civilian, provide support in the form of resources and toolkits to support these contingency operations. The VAO has assembled a toolkit of guidance and resources to enable federal officials to respond quickly. Below you will find Frequently Asked Questions, VAO resources, and news that may aid government officials in supporting recovery efforts.

 

Frequently Asked Questions

What contracting authorities or requirements kick in during a declared emergency?
What is the local area preference that applies when an emergency has been declared?
How do agencies provide preference to local vendors?
Is there a central listing of contractors available for debris removal, distribution of supplies, and reconstruction?
What other flexibilities can be applied in this situation?
Can we contract with the private sector for additional acquisition support that may be needed?
Does DHS limit the length of noncompetitive DHS response and recovery contracts?
If federal offices close during the emergency/disaster, do we need to modify our contracts to account for work stoppages?
Has the Department of Defense (DoD) issued any class deviations related to the recent Coronavirus Disease 2019 (COVID-19)?

 

What contracting authorities or requirements kick in during a declared emergency?

Several contracting authorities and requirements kick in when an emergency or major disaster is declared:

 

A local area preference applies, per the requirements of Section 5150 the Stafford Act.

 

Section 5149 of the Stafford Act allows “any [f]ederal agency” to appoint temporary personnel, experts, and consultants to assist in responding to emergency and major disaster situations. An agency may incur obligations “by contract or otherwise” for the acquisition, rental, or hire of equipment, services, materials, and supplies for shipping, drayage, travel, and communications, and for the supervision and administration of such activities, “in such amount as may be made available to it by the President.”

 

Section 5149 of the Stafford Act also authorizes any federal agency to accept and use the services or facilities of any state or local government.

 

5 USC 644(f) establishes a contracting preference for a small business concern located in a disaster area if the small business concern will perform the work required under the contract in the disaster area. Preference will be given to local organizations, firms, and individuals when contracting for major disaster or emergency assistance activities. Preference may take the form of local area set-asides or an evaluation preference. (See 6.208 and subpart  26.2.)  Check with your agency legal counsel if you have questions about its application.

 

Special emergency procurement authority under 41 USC 1903 goes into effect. The micropurchase threshold increases to $20,000 and the simplified acquisition threshold increases to $750,000 for any contract to be awarded and performed, or purchase to be made, inside the United States. For any contract to be awarded and performed, or purchase to be made, outside the United States, the thresholds increase to $30,000 and $1.5 million respectively. The authority to use simplified acquisition procedures for commercial item buys under FAR 13.5 increases to $13 million. See the Civilian Agency Acquisition Council CAAC Letter 2018-02 and the Department of Defense Class Deviation- 2018-O0018.

 

More detail is available in OFPP’s Emergency Acquisition Guide of January 2011.

 

 

What is the local area preference that applies when an emergency has been declared?

It is a preference for using local vendors for supplies and services such as debris clearance, distribution of supplies, or reconstruction contracts.

 

When a major disaster or emergency has been declared for a specific state (or states) under authority of the Stafford Act, contracting officers “shall” give preference to the extent feasible and practicable to organizations, firms, or individuals residing or doing business primarily in the area affected by the major disaster or emergency when contracting for activities such as debris clearance, distribution of supplies, or reconstruction. This preference is limited to the period of time for which the emergency has been declared. Learn more on pages 3-5 of the Emergency Contracting Advisory.

 

 

How do agencies provide preference to local vendors?

There are two ways in which preference may be provided: (1) through a set-aside for local vendors; or (2) through the use of locality as an evaluation factor. The contracting officer decides which mechanism to use. If a set-aside is used, the contracting officer is not required to prepare a justification or determination and findings. The set-aside area specified by the contracting officer shall be a geographic area within the area identified in a Presidential declaration(s) of major disaster or emergency and any additional geographic areas identified by the Department of Homeland Security.  The contracting officer may use locality as an evaluation factor, when authorized by agency regulations or procedures.  A justification or determination and findings may be needed if your agency requires.

 

In addition, 42 U.S.C .5150(b)(1) requires that, subsequent to any Presidential declaration of a major disaster or emergency, any expenditure of Federal funds, under an emergency response contract not awarded to a local firm, must be justified in writing in the contract file. The justification should include consideration for the scope of the major disaster or emergency and the immediate requirements or needs of supplies and services to ensure life is protected, victims are cared for, and property is protected.  The justification may be made on an individual or class basis. The contracting officer approves the justification.

 

 

Is there a central listing of contractors available for debris removal, distribution of supplies, and reconstruction?

Yes. A list of contractors available for debris removal, distribution of supplies, reconstruction, and other disaster or emergency relief activities is available via the Disaster Response Registry, as noted in Federal Acquisition Regulation (FAR) 26.205. The registry is available through the System for Award Management (SAM).

 

 

What other flexibilities can be applied in this situation?

A variety of existing regulations – and contracting vehicles – allow for efficient and effective contracting in any type of emergency or urgent situation. FAR 18, Emergency Acquisitions, identifies acquisition flexibilities that are available for emergency acquisitions, including specific techniques or procedures that may streamline the standard acquisition process.

 

Some best practices to keep in mind:

 

Seek to leverage existing vehicles. Ordering from established contracts is a great first option, given that competition already has been conducted, terms and conditions established, and prices determined fair and reasonable. FEMA has established a variety of readiness contracts for emergency-type situations and the General Services Administration provides contract and other resources.

 

Consider simplified acquisition procedures. The vast majority of emergency-related requirements can likely be met via simplified procedures, which apply to requirements under the simplified acquisition threshold of $250,000. And while FAR 5.101(a)(1) specifies that all procurement actions greater than $25,000 must be posted in the Governmentwide point of entry (FedBizOpps), FAR 5.202(a)(2) provides that the contracting officer need not submit the notice for simplified acquisitions “if unusual and compelling urgency precludes competition to the maximum extent practicable…and the government would be seriously injured if the agency complies with the time periods specified in 5.203.”

 

Limit competition based on “unusual and compelling urgency.” FAR 6.302-2 allows an agency to contract “without providing for full and open competition” when the agency’s need for the supplies or services is of such an unusual and compelling urgency that the government would be seriously injured unless the agency were permitted to limit the number of sources from which it solicits bids or proposals.

 

Award sole source contracts to 8(a), HUBZone, service-disabled-veteran-owned small businesses (SDVOSBs), or woman-owned small businesses (WOSBs). If an 8(a), HUBZone small business, SDVOSB, or WOSB can meet the needs, awards under certain thresholds are permitted to these companies on a sole-source basis, which can minimize the time to make an award.

 

Issue oral requests for proposals (RFPs). Special authority to use oral proposals kicks in during emergency situations.

 

These and other authorities are explored in detail on pages 12 through 17 of the Advisory on Emergency Contracting.

 

 

Can we contract with the private sector for additional acquisition support that may be needed?

Yes. Having a cadre of contracting personnel to function as a rapid deployment force on short notice is a definite best practice. Depending on the agency’s mission and the emergency, some agencies may need to look to contractors to provide additional professional acquisition support. Setting up blanket purchase agreements or basic ordering agreements with contractors in advance of emergencies can facilitate an agency’s ability to have access to these individuals when needed. However, even if agencies do not have advance agreements in place, this does not preclude them from awarding contracts, as needed, to provide the necessary support. Such contracts must follow all relevant FAR requirements.

 

 

Does DHS limit the length of noncompetitive DHS response and recovery contracts?

Yes, for all response and recovery contracts awarded noncompetitively – i.e., without seeking competition – on or after September 21, 2012, the contracts cannot cover a period longer than 150 days. This DHS rule implements section 695 of the Post-Katrina Emergency Management Reform Act of 2006 (Public Law 109-295).

 

 

If federal offices close during the emergency/disaster, do we need to modify our contracts to account for work stoppages?

Unless specified in the contract, fixed-price contracts generally would not be adjusted for a work stoppage as long as the stoppage isn’t prolonged and the schedule is met. If access to government facilities is required to perform a fixed-price contract and the contractor is unexpectedly denied access, adjustments may need to be made in the performance dates and for any increases in the cost of performance in accordance with the applicable Changes clause or clause prescribed in FAR subpart 42.13.

 

Under a cost reimbursement or time-and-materials/labor hour (T&M/LH) pricing arrangement, the FAR does not specifically provide guidance if a contractor is prevented from working due to circumstances beyond its control. However, unless the contract contains language addressing such issues, the governing clauses at FAR 52.216-8, “Allowable Cost and Payment,” and FAR 52.232-7, “Payments under Time-and-Materials and Labor-Hour Contracts,” do not authorize payment for direct labor hours not performed. For commercial T&M services, the clause at 52.212-4 Alternate I, paragraph (i), contains similar language.

 

 

Has the Department of Defense (DoD) issued any class deviations related to the recent Coronavirus Disease 2019 (COVID-19)?

 

Yes, the following class deviations have been issued:

 

2020-O0010 was issued on March 20, 2020 and effective immediately, the progress payment rates at Defense Federal Acquisition Regulation Supplement (DFARS) 232.501-1 are increased to 90 percent for large business concerns and 95 percent for small business concerns.

 

2020-O0011, Revision 1 was issued on April 3, 2020 and effective immediately, contracting officers shall direct contractors to submit interim vouchers under classified contracts, using an appropriate method, directly to the payment office listed in the contract. Interim vouchers under classified contracts are considered provisionally approved by the Defense Contract Audit Agency (DCAA). Contracting officers shall require contractors to follow all program security protocols and to continue to safeguard program information when submitting interim vouchers that are considered provisionally approved.

 

2020-O0012 was issued on April 3, 2020 and effective immediately, for undefinitized contract actions (UCAs):

 

  • The requirement at DFARS 217.7404-4(a) to limit obligations, after receipt of a qualifying proposal, to 75 percent of the not-to-exceed price before definitization does not apply to UCAs related to the national emergency for the Coronavirus Disease 2019 (COVID-19), as determined by the head of the contracting activity.

 

  • The head of the contracting activity may waive the limitations in DFARS 217.7404(a)(1)(i), 217.7404-3(a), and 217.7404-4(a) for a UCA, if the head of the contracting activity determines that the waiver is necessary due to the national emergency for COVID-19. The words “without power of redelegation” at DFARS 217.7404-3(a)(1) are deleted.

 

2020-O0013 was issued on April 8, 2020 and effective immediately, authorizes contracting officers to use the included DFARS 231.20579, CARES Act Section 3610 Implementation, as a framework for implementation of section 3610, Federal Contractor Authority, of the Coronavirus Aid, Relief, and Economic Security (CARES) Act (Pub. L. 116-136).

 

2020-O0014 was issued on April 20, 2020 and effective immediately, debarring and suspending officials may deviate from the requirements at FAR 9.406-3(c) and (e) and 9.407-3(c) and (d)(4) to provide notices of proposed debarment or suspension and debarring and suspension official decisions to contractors via certified mail, return receipt requested. In addition to these forms of notification, debarring and suspending officials are also authorized to provide such notices and decisions to contractors electronically via e-mail and/or secure file exchange service.

 

2020-O0016 was issued on April 30, 2020 and effective immediately, to respond to the Coronavirus Disease 2019 (COVID-19) national emergency, contracting officers shall utilize the deviations from the Federal Acquisition Regulation (FAR) and the Defense Federal Acquisition Regulation Supplement (DFARS) authorized in attachments 1 and 2 of the deviation, respectively, to provide flexibility with regard to original documents, manual signatures, seals, and notarization in order to facilitate certain essential contracting procedures.

 

  • Specifically applies when:
    • Obtaining financial protection against losses under contracts per FAR 28
    • Processing assignment of claims per FAR 32.8
    • Executing novation agreements and change-of-name agreements per FAR 42