(a) This section establishes agency-wide policy for deciding, during the final year of performance in the LoO, whether an MEO should be re-competed or an HPO competed (See Pub. L 110-187, sec. 323, amending 10 USC 2461(a)(4)). Under the Program Budget Review process, all MEOs and HPOs will be programmed for competition announcement to take place six months after the completion of their final performance period. Six to nine months prior to the end of the final performance period as established in the LoO, MEOs and HPOs will be reviewed by a special I-ARB. The I-ARB will review performance for all periods completed up to but not including the final year of performance specified in the LoO, and may also consider performance during the final year to the extent information is available . The review will be based on assessments provided by the RA and ACO, as well as any supplemental independent assessments that have been conducted. The Senior Procurement Executive (SPE) may convene a special I-ARB at any time based on ACO reports of unacceptable or declining performance by an MEO/HPO.
(b) The assessment will consider at least the following factors, and may also consider other relevant factors:
(1) LoO cost compliance: actual cost against adjusted LoO cost (including approved
modifications);
(2) LoO performance compliance: quality of performance as measured against LoO requirements, to include acceptable performance levels;
(3) Overall change in authorized LoO cost from original LoO cost;
(4) Overall change in requirements (nature/extent; present/anticipated); and,
(5) Market assessment (contracting officer only).
(c) The ACO/RA will brief the review/assessment to the I-ARB. Following the briefing the I-ARB will recommend to the DLA CSO the most advantageous course of action to the Agency from the following options:
(1) Initiate preliminary planning to compete the requirement covered by the existing LoO;
(2) Extend the MEO/HPO for up to five more years as an Agency-recognized MEO/HPO; or,
(3) Take an alternative course of action (e.g., managed reduction, business process re-engineering, organizational realignment, etc.)
(d) If the DLA CSO decision is to compete the requirement covered by the existing LoO, the existing LoO will be allowed to expire at the end of the final performance period in order to allow the RA to use MEO/HPO resources to prepare for the competition.
(e) If the DLA CSO decision is to extend performance under the LoO for up to five additional years, the PCO will issue a new LoO effective the day following the previous LoO’s expiration. The RA, ACO, and extended MEO/HPO must comply with J-7/DLA Defense Logistics Acquisition Directive LoO policy with the following exceptions:
(1) DCAMIS will not be used unless the MEO/HPO is recognized by OSD.
(2) No “Milestone C” I-ARB is required for an extended MEO, unless otherwise directed by the SPE.
