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Awarding the License to Bill: An Argument for the Use of Qualification-Based Selection in the Award of Cost-Reimbursement Contract Work Open Access

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Cost-reimbursement contracts allow the Government to hire contractors to perform work where either the Government cannot define its needs with specificity or uncertainties in the details of performance preclude accurate cost estimates. Under these circumstances, fixed-price contracts are inappropriate because binding the contractor to an initial price estimate would be counterproductive. However, the Competition in Contracting Act (CICA) requires an agency using the tradeoff selection method to apply price competition, even when awarding a cost-reimbursement contract. Although qualification-based selection (QBS) is likely a better fit for cost-reimbursement contracts, QBS has traditionally been limited to the Brooks Act’s procedures for awarding architect-engineer services. However, the January 2017 Sevatec decision from the Government Accountability Office (GAO) may provide a CICA-compliant method of conducting QBS. The GAO concluded that a “highest technically rated offeror with a fair and reasonable price” method does not violate CICA so long as the agency considers the cost or price of the awardees. Although Sevatec involved a multiple-award contract with an expectation of further competition for the award of individual task or delivery orders, the GAO’s rationale was not based on the expectation of further competition. Even though differences in how CICA and the Brooks Act handle negotiations preclude agencies from copying the Brooks Act’s procedures in their entirety, post-Sevatec QBS could provide a CICA-compliant alternative to the tradeoff method for the award of cost-reimbursement contracts.

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