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OCR for page 25
The Decision Model 25
Step 8--Define Contract Scope and Terms and Conditions START
Use
The final step in the Decision Model involves the selection of the terms and conditions to be outsourc-
ing
included in the contract. As with Step 6, you'll want to do this step in close collaboration with your process
(procure-
agency's procurement personnel. Although some terms and conditions are required for all types ment
package
of contracts, others are only suitable for certain types of contracts (i.e., commodity supplier, low 6 or 7)
bid with design consultant, systems manager, and design-build contractor). The following list of STEP 1
INITIAL
DECISIONS
mandatory contract terms and conditions should be considered regardless of procurement pack-
Use Other
age used: consulting services
process being
(procure-
· Parties to the contract ment
procured.
Not
package
· Scope of the contract 5)
covered
by this
· Compensation and method of payment Model.
· Extras STEP 2
WORK
Yes
· Assignment of claims DISTRIBUTION
Send
· Agency-furnished property individual
projects
· Order of precedence through
the
· Commercial warranty Decision
Model.
· Patent rights
· Multi-year contracts contingent upon appropriations No
· Termination for default
· Termination for convenience STEP 3 STEP 4
DEFINE PROJECT DETERMINE
· Execution and commencement of work CATEGORY(IES) AGENCY
CAPABILITY LEVEL
· Delays and extensions of time
· Modifications STEP 5
SELECT APPLICABLE
· Multiple contract awards SYSTEMS
ENGINEERING
· Liquidated damages PROCESS(ES) &
CANDIDATE
· Variations in estimated quantities PROCUREMENT
PACKAGE(S)
· Suspension of work
· Incorporation by reference STEP 6
· Specifications APPLY
DIFFERENTIATORS
· Delivery and acceptance Schedule
Constraints
· Intellectual property
STEP 7
· Contractor's invoices PACKAGE
·
ASSESSMENT
Conflicting terms AND FINAL
SELECTIONS
Table 5 identifies terms and conditions that are most appropriate to specific procurement
packages. The section following Table 5 provides definitions for all of the terms and conditions STEP 8
DEFINE CONTRACT
in both the above list and Table 5. SCOPE AND TERMS
& CONDITIONS
Your agency is likely to have standard sets of terms and conditions that are to
be incorporated in the request for proposals and resulting contract. In the
ITS is not explic- END
unlikely event that standard terms and conditions are not available within your
itly referenced in
the FAR. Relevant agency, or if you are looking for guidance on a specific term and condition not
information can be typically used by your agency, the Federal Acquisition Regulations (FAR) is a
found in sections good source of information. The FAR, which governs the majority of federal
referencing IT. procurements, includes language for myriad terms and conditions including
those appropriate to ITS projects.
OCR for page 26
26 Guide to Contracting ITS Projects
Table 5. Procurement packages and their associated terms and conditions.
Procurement Package Terms and Conditions
Commodity Supplier Contractor Inspection Requirements Definite Quantity
Inspection of Supplies Indefinite Quantity
Option for Increased Quantity Brand Name of Equal
Ordering Performance/Payment Bond
Low-Bid Contractor Design within Funding Limitation Fixed Price
with Design Consultant Redesign Responsibility for Design Errors Incentive Fee
or Deficiencies Performance/Payment Bond
Deficiencies
Systems Manager Negotiation Specifications
Commercial Computer Software Restricted Delays and Extensions of Time
Rights Modifications
Fixed Fee Delivery and Acceptance
Incentive Fee Conflicting Terms
Rights in Data Patent Infringement Indemnification
Allowable Costs and Payment Federal Grant Flow-Down Provisions
Performance-Based Payments Performance/Payment Bond
Delivery Orders (Task Orders)
Design-Build Negotiation Fixed Fee
Contractor with Design within Funding Limitations Incentive Fee
Design Consultant Redesign Responsibility for Design Errors Execution and Commencement of Work
Work Oversight Performance/Payment Bond
Suspension of Work Specifications and Drawings
Consultant Negotiation Specifications
Notice of Cost Comparison Delays and Extensions of Time
Allowable Costs and Payment Modifications
Fixed Fee Delivery and Acceptance
Incentive Fee Disputes
Performance-Based Payments Retention of Records
Deliver Orders (Task Orders) Indemnification
Outsourcing Agency Negotiation Performance/Payment Bond
Activity Fixed Fee Allowable Costs and Payment
Incentive Fee Performance-Based Payments
Work Oversight Modifications
Execution and Commencement of Work Rights in Data
Outsourcing Agency Negotiation Performance/Payment Bond
Function Fixed Fee Allowable Costs and Payment
Incentive Fee Modifications
Work Oversight Rights in Data
Execution and Commencement of Work
