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Chat with Lisa! Let's talk about pricing ....

Welcome back to the Integrations blog! 

Today’s update on the business case:  The Federal Acquisition Service Commissioner, Steve Kempf, received a full briefing on the business case early this week.  There are a few remaining items that need to be addressed before Mr. Kempf makes a decision whether to proceed.

The blog topic today deals with pricing.  Given that Integrations may be a hybrid acquisition vehicle with the potential for all contract types at the task order level, customers will want flexible awarded pricing in order to determine fair and reasonable pricing at the task order level. 

What concerns exist for industry should GSA require submission of fully burdened rates and cost ceiling rates for each identified labor category?

Lisa

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Integrations Blogger
<p><font size="2">Thank you Mr. Youman for a thoughtful strategy. &nbsp;We both have the same objective - the vehicle of choice for customers across the government that is flexible and balanced and meets their needs. &nbsp;We will consider your input as we further define our acquisition strategy. &nbsp;Please continue to weigh in as new topics are posted or follow on to this response.&nbsp;&nbsp;</font></p>
Mark Youman
<p>Lisa,</p><p>Thanks for the update and for your continued outreach to the industry community!&nbsp; We have a few thoughts related to your pricing question.</p><p>Given the broad potential of the Integrations contract for clients across government and across the country, we agree that labor rate pricing will need to accommodate a wide range of needs.&nbsp; For any given labor category, for example &ldquo;Senior Program Analyst,&rdquo; vendors will need to be able to provide staff for situations ranging from a Top-Secret-cleared-with-polygraph NSA contract in a highly advanced program area in the DC Metro area (high cost clearance, high cost domain area, high cost location,) to a more straightforward, unclassified contract in Oklahoma (no clearance cost, lower cost domain area, lower cost location).&nbsp; For complex integrated contracts there can even be a wide range of costs within the project &ndash; from expert planners and advisory consultants to more tactical implementation staff.&nbsp;</p><p>A structure that allows for broadly applicable ceiling rates that are discounted at the task order level will help maximize use of the contract across Civilian and DOD customers.&nbsp; In this framework separate rate cards for government-site and contractor-site are useful, but the addition of further rate cards that differentiate geographic location or multiple clearance levels or other factors would create an unwieldy and inflexible structure.&nbsp; Market competition at the task order level will drive discounted rates to accommodate the unique circumstances of each task order.&nbsp; Additionally, this type of flexibility will insure that federal agencies will have access to the full range of talent that is available in the labor market. As a result, the GSA will be able to attract a larger percentage of the spending within the scope of GSA Integrations to use this contract vehicle and thereby eliminate the need for other agencies to create similar contract vehicles.&nbsp; This will result in administrative cost savings to the federal government as a whole.</p><p>We therefore would recommend an evaluation structure where: non-price factors are significantly more important than price; each price proposal will be evaluated but will not be assigned a rating; and price is evaluated to determine that labor rates are fair, reasonable, and balanced.&nbsp; This type of approach has been employed on major contracts such as GSA Alliant and DHS Eagle II.</p><p>Mark Youman</p><p>ICF International</p>
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