(a) General.
(90) The cost/price analysis element shall provide:
(1) A price or cost/price analysis report, as appropriate, for:
(i) all sealed bid acquisitions of $550,000 or more where a sole responsive bid is received, and
(ii) all negotiated acquisitions of $550,000 ($200,000 for FPI (see 8.602(a)(91)(iii))) or more, where adequate price competition was not received (see FAR 15.403-1(c)(1)(i)), unless the contracting officer performs a price analysis (including, for rebuys, a comparison to prices paid for the same item in accordance with 15.404-1(b)) which documents that the price is fair and reasonable and is:
(A) based on adequate price competition (FAR 15.403-1(c)(1)(ii) or (iii)),
(B) set by law or regulation (FAR 15.403-1(c)(2)), or
(C) for a commercial item (FAR 15.403-1(c)(3)).
(2) A price analysis or cost/price analysis, as appropriate, for any other acquisition where assistance is deemed necessary by and requested by the contracting officer.
(3) Recommendations and coordination on all planned actions involving the "resolution" and "disposition" (see 15.406-3(b)(91)b(2) and (3) respectively) of defective pricing and other "reportable" audits, and instances of suspected overpricing.
(4) All reports of reviews covering multiple line items shall include comments on the results of an assessment for unbalanced bids or offered prices (FAR 15.404-1(g)).
(5) Assessment assistance on actions involving sole-source items subject to limited competition (see PGI 15.402-92) when deemed necessary and requested by a contracting officer; and
(6) Review/approval status concerning:
(a) Contractor Accounting System reviews,
(b) Cost Accounting Standards Disclosure Statement adequacy reviews and compliance reviews,
(c) Contractor Estimating System Reviews,
(d) Contractor Insurance/Pension Reviews,
(e) Contractor Purchasing System Reviews, and/or
(f) other similar status information applicable to a specific contractor entity when deemed necessary and requested by the contracting officer.
(91) The contracting officer (the price analyst and/or value engineering/other technical specialist when requested to furnish an analysis of the proposal}, shall identify or have identified from existing data bases and/or files, any independent Government estimate (IGE){"should cost") that had been performed; and include in the proposal evaluation report and prenegotiation briefing memorandum, comments as to the extent of utility of the IGE results as analytical or corroborative information for determining price reasonableness, establishing negotiation objectives, and for contract negotiations.
(92) If the contracting officer determines that a procurement is for an item that meets the commercial item definition at FAR 2.101, the contracting officer cannot determine the offered price to be fair and reasonable on that basis alone. Some form of proposal analysis is also required.
(b) Price analysis.
(90) Whenever cost or pricing data or commercial item exemption data is obtained, the analysis shall also address the reasonableness of the offered price in comparison to prior prices paid for the item.
(2)(ii) When a comparison or trend analysis to prior prices is used, the rationale and amount of allowance (negative, zero, or positive adjustment) for each factor cited in the FAR shall be included in documentation of the price reasonableness determination, along with a statement of how these prior prices were determined reasonable. The contracting officer must consider the nature of the Government’s requirement (e.g., quantities being acquired, how the item is managed) compared with the circumstances under which prices were paid by another customer (e.g., quantities being acquired, whether an urgent requirement drove the price up). The contracting officer should take maximum advantage of the Government’s potential purchasing power and should expect terms and prices at least equal to those available to commercial or other customers that have similar size and influence in the market.
(2)(iv) When a price appearing in a contractor catalog or price list is utilized to determine price reasonableness, the contracting officer shall include in the reasonableness determination documentation of the steps taken in confirming that the price list is current and depicts prices at which sales are currently being made or were last made. See 12.102(90) for guidance on determining if a procurement is for an item that meets the commercial item definition at FAR 2.101.
(2)(v) However, the standard price, the material acquisition unit price (MAUC) (unless based on recent purchases and escalated to the intended award date), budgetary estimates, and provisioning estimates are invalid bases for comparative price analysis and price reasonableness determinations.
(c) Cost analysis.
(90) When a contractor catalog or other price developed using proposed, recommended, or approved forward pricing rates, factors, and/or a formula pricing methodology is utilized to determine price reasonableness, the contracting officer shall include in the price reasonableness determination documentation of the steps taken in confirming that the rates and factors and/or formula pricing methodology and catalog prices are current and have been reviewed and determined reasonable, the review date, and the office accomplishing that review (i.e., normally the field ACO). Use of this technique also requires documentation that the direct material quantities/prices, direct labor hours, and/or other bases against which the rates and factors are applied have been reviewed and determined reasonable.
(c)(2)(iii) The comparison may be to actual costs incurred for the same item or for a similar item (with any necessary adjustments to achieve comparability of market conditions, quantities, time periods, and terms and conditions) by the same or another supplier.
(c) Cost analysis.
(91) One Pass Pricing. One Pass Pricing (OPP) process is a joint contractor and government process that allows simultaneous proposal preparation, proposal analysis, and agreement on price significantly reducing the procurement lead time. The OPP process may be used by the contracting officer to price sole-source items in establishing a long-term contract (LTC), addition/modification to an existing LTC, or a stand alone fixed quantity contract. Cost or pricing data, or information other than cost or pricing data, is used in the OPP process as prescribed in FAR 15.403. One Pass Pricing is used in sole-source procurements where acceptable accounting practices exist and both parties (contractor and government) have entered into an agreement that identifies the essential elements of the process and satisfactorily addresses contractual and oversight requirements of their respective organizations. The use of the OPP process is optional, but if used the contracting officer shall follow the DLAD PGI 15.404-1(c)(91) guidance.
