DoD issued a final rule under DFARS Case 2020-D033, effective April 28, 2022, that allows Contracting Officers to rely on a contract issued under FAR Part 12 procedures to serve as a prior commercial item determination on future buys. It only makes sense, that Contracting Officers rely on prior FAR 12 contracts instead of recreating the wheel each time a contractor submits a commercial product/service and making the contractor continually support a product/service already determined commercial.
There are a Couple of Stipulations:
- The Contracting Officer must still conduct and document market research, especially to support price analysis,
- Contracting Officers can only rely on prior commercial item determinations made by DoD, not a prime contractor determination, and
- Prior FAR 12 contracts for supplies or services used to facilitate defense against or recovery from cyber, nuclear, biological, chemical, or radiological attack or supplies or services from nontraditional defense contractors cannot be used.
What Does that Mean to Government Contractors?
Contractors should not have to continually update and provide information to support its commerciality assertion. A copy of a prior FAR 12 contract should be adequate. In the past Contracting Officers continued to request the contractor provide support, because the prior commercial item determinations were missing from the file or in many cases the Contracting Officer was uneasy with relying on the work of another Contracting Officer. If you are submitting a commercial product or service to the government for which a FAR 12 contract exists for the same product/service, inform the Contracting Officer so they can rely on the previous contract and expedite the acquisition process.
What Does that Mean to You as a Higher-Tier Government Contractor?
For contractor generated commercial item determinations on a supplier, once an item or service has been determined commercial by your purchasing department, additional determinations for future buys of the same item or service do not need to be performed. Just like the Government, buyers can rely on prior determinations, but you need to maintain an audit trail back to the original documentation. A best practice is to create a database of parts determined commercial and a separate file where a copy of the original determination can be maintained; so, when the PO files are archived or dispositioned when closed, the determination is not lost over time.
Redstone GCI assists contractors throughout the U.S. and internationally with understanding the Government’s expectations in making a Commercial Item Determination. Redstone has staff that worked for both DCAA and DCMA, even some for the DCMA – Commercial Item Group, which have worked numerous packages to support a successful commercial item determination.
Lynne is a Director with Redstone Government Consulting, Inc. providing government contract consulting services to our clients primarily related to Commercial Item Determinations and support, Cost Accounting Standards, DFARS Business System Audits, Proposals, and Incurred Cost. Prior to joining Redstone Government Consulting, Lynne served in several capacities with DCAA and DCMA for over 35 years. Professional Experience Lynne began her career working with DCAA in the Honeywell Resident Office, Clearwater, FL in 1984. Lynne’s experience included various positions which involved conducting or reviewing forward proposals or rate audits, financial capability audits, progress payments, accounting and estimating systems, cost accounting standards, claims and disclosure statement reviews. She is an expert in FAR, DFARS, CAS and testified as an expert witness. Lynne assisted in drafting the commercial item guidance for DCAA Headquarters. Lynne was assigned as a Regional Technical Specialist where she provided guidance to 20 field offices on highly complex or technical issues relative to forward pricing, financial capability or progress payment issues. As an Assistant for Quality, she was involved in reviewing and ensuring audit reports were in compliance with policy and GAGAS as well as made NASBA certified presentations to the staff including but not limited to billing reviews, CAS, unallowable cost and progress payments. To enhance her experience in government contracting, Lynne accepted a position with DCMA in 2015 as part of the newly organized DCMA Cadre of Experts in the Commercial Item Group. This included performing reviews of prime contractor’s assertions and/or commercial item determinations as well as performing price analyses. Lynne was a project lead and later became a lead analyst where she engaged with the buying commands on requests and reviewed price analysis reviews performed by a team of 5 analysts. She also assisted the DCMA CPSR team relative to commercial items and co-instructed the Commercial Item Training presented to DCMA. Education Lynne earned a Bachelor of Science Degree in Accounting from the University of Central Florida. Certifications State of Florida Certified Public Accountant State of Alabama Certified Public Accountant Defense Acquisition Workforce Improvement Act (DAWIA) Level III- Auditing DAWIA Level III – Contracting