Truth in Negotiations (TINA) Policy

BACKGROUND

1.1. The U.S. Congress passed the Truth in Negotiations Act (TINA) in order to place the US Government (USG) (or Prime or higher tier subcontractors acting on behalf of the USG) on an equal footing with contractors in contract negotiations. This is accomplished by requiring contractors to provide certified cost or pricing data which supports the estimated costs in a proposal or quote. Certified cost and pricing data is cost or pricing data which Govcwiki certifies is current, complete, and accurate. In the event a contractor provides certified cost and pricing data that is NOT current, complete and accurate the government has remedies via contract clauses for price redetermination, interest (computed daily) on the amount of the overpayment caused by the non-current, non-complete, or inaccurate data and a penalty equal to the amount of the overpayment. Other remedies include administrative, civil and criminal proceedings which could affect Govcwiki negatively with financial and reputational impacts and could impact Govcwiki’s ability to secure future USG contracts.

PURPOSE

2.1. This purpose of this policy is to ensure that employees understand and adhere to the requirements of the Truth and Negotiations Act (TINA) by certifying cost and pricing data which we know is current, complete and accurate.

DEFINITIONS

“Adequate Price Competition” - is determined by USG contacting officer, generally when two or more responsible competitors submit reasonably priced proposals that meet USG’s requirements and award is determined by a source selection that includes price as an evaluation criterion – see FAR 15.403-1(c)(1).

“Basis of Estimate” - means the rationale provided in the cost proposal for the basis of a cost (material, labor, or other). For example: “Program Management hours are based on past experience managing Program X, which is similar in complexity and duration.”

“Cost or Pricing Data” - FAR 2.101 defines this as all facts that, as of the date of price agreement of a contract (or the price agreement of a contract modification) or, if applicable, an earlier date agreed upon between the parties 1.1.1. that is as close as practicable to the date of agreement on price, prudent buyers and sellers would reasonably expect to affect price negotiations significantly.

“Certificate of Current Cost or Pricing Data” - is the certificate required by the Customer that states that to the best of Govcwiki’s knowledge and belief, the Cost or Pricing Data submitted is accurate, complete, and current as of the date of price agreement - see FAR 15-406-2.

“Customer” - means the USG agency or prime contractor or higher tier subcontractor with a USG funded program that has requested a proposal from Govcwiki in support of a program.

“Date of Price Agreement” - means the date that the parties agree (handshake) on the estimated cost or price for a defined order, including all terms and conditions that affect price.

“Defective Pricing” - occurs when the Cost or Pricing Data submitted by Govcwiki and on which the Customer relied during negotiations is determined to be non-current, inaccurate, or incomplete. If Cost or Pricing Data is found to be defective, a presumption is created that the negotiated price is higher than it otherwise would have been.

“TINA Sweep” - means the process used to review, validate, and ensure that all financial information and other records previously provided to the Customer during negotiations or proposal submission are still current, accurate, and complete as of Date of Price Agreement and/or the date of the Certificate of Current Cost or Pricing Data. This should reveal factual data during Internal Sweep that one would expect to affect cost/price significantly that exists or became available after earlier submission(s), but prior to final price agreement and which data was not disclosed previously to the Customer.

“Negotiation Team” - means one or more Govcwiki employees responsible for negotiating the proposal and ensuring that Cost or Pricing Data provided to USG negotiators is current, accurate, and complete.

“Price” - means cost plus any fee or profit applicable to the contract type.

“Signature Authority” - means contract professionals with delegated authority to execute contracts on behalf of Govcwiki.

“Forward Pricing Rate Agreement” - means a written agreement negotiated between a contractor and USG to make certain rates and factors available during a specified period for use in pricing contracts or modifications. These rates represent reasonable projections of specific costs that are not easily estimated for, identified with, or generated by a specific contract, contract end item, or task. These projections may include rates for such things as labor, indirect costs, material obsolescence and usage, spare part provisioning, and material handling. When Cost or Pricing Data is required, Govcwiki is required to identify and describe any such agreements in accordance with FAR 15.407-3(a).

SCOPE

This policy applies to all Govcwiki organizations (Home Offices, Sectors and BUs) which either have USG contracts which are covered by TINA, or allocate to BUs which have USG contracts.

POLICY

It is Govcwiki’s Policy that all USG proposals and contract modifications that require submission of a Certificate of Current Cost or Pricing Data to the USG, either directly, as a prime to the USG, or indirectly as a subcontractor, will be current, accurate, and complete as of the Date of Price Agreement with the Customer and before the Signature Authority signs the Certificate of Current Cost or Pricing Data and submits it to the Customer.

BASIC REQUIREMENTS

If Govcwiki becomes aware of additional information between the date of preparation of the proposal and the Date of Price Agreement (such as a revised vendor quote) that information must be disclosed to the Customer in a manner that clearly shows how the information relates to the original price proposal.

All Govcwiki personnel who prepare, review, or approve a Basis of Estimate, Certification Checklist, or TINA Sweep in support of a TINA contract, must sign that the area to which they contributed is current, complete, and accurate. This is generally accomplished by signing the TINA Sweep document.

It is the responsibility of all Govcwiki employees involved in the proposal process, to be familiar with and ensure compliance with TINA and FAR 15 It is their responsibility to seek advice and guidance from management or subject experts regarding compliance with this requirement if there is doubt or question.

The Certificate of Current Cost or Pricing Data must be signed by the Signature Authority, but only after ensuring the proper TINA Checklist/Sweep has occurred and completed in its entirety.

All TINA contracts require a negotiation summary.

TINA contracts require “Post Award” monitoring. Post award monitoring allows for variances between the estimate and actuals to be determined, and when detected documented in the contract file.

SEE ATTACHED TINA POLICY

http://www.govcwiki.org/index.php?title=File:Truth_in_Negotiations_(TINA)_Policy.docx