Government contracting glossary

A responsive bid is one that conforms in all material respects to the invitation for bids — a test applied to the paperwork at bid opening — as distinct from responsibility, which is a judgement about whether the bidder can actually perform.

Request for Information

An RFI is market research: the government is asking industry what is available and what it would take, and FAR 15.201(e) says an RFI is used when the government does not intend to award a contract on the basis of the responses.

Request for Proposal

An RFP is a federal solicitation that asks for a binding proposal on work where the buyer intends to weigh factors other than price alone, and it is issued under the negotiated-procurement rules in FAR Part 15.

Request for Quotation

An RFQ asks vendors what they would charge, and a quotation in response is not an offer the government can accept to form a contract — the government's purchase order is the offer.

Sealed bidding is the FAR Part 14 procedure in which the government issues an invitation for bids, opens all bids publicly at a fixed time, and awards to the lowest responsive, responsible bidder on price alone, with no negotiation.

An amendment is the government's formal change to a published solicitation — issued on Standard Form 30 — and failing to acknowledge one can make an otherwise winning bid nonresponsive.

Blanket Purchase Agreement

A BPA is, in the FAR's own words, a simplified method of filling anticipated repetitive needs for supplies or services by establishing charge accounts with qualified sources of supply.

Cost-Plus-Fixed-Fee contract

A cost-plus-fixed-fee contract reimburses the contractor's allowable costs and pays a negotiated fee that is fixed at the outset and does not vary with actual cost, though it may be adjusted if the work itself changes.

Fair opportunity is the requirement that every holder of a multiple-award indefinite-delivery contract be given a fair chance to be considered for each order placed under it, above the micro-purchase threshold and subject to stated exceptions.

Firm-Fixed-Price contract (FFP)

A firm-fixed-price contract sets a price that is not subject to adjustment on the basis of the contractor's cost experience, which places the full cost risk — and the full benefit of efficiency — on the contractor.

Governmentwide Acquisition Contract

A GWAC is defined by FAR 2.101 as a task-order or delivery-order contract for information technology established by one agency for governmentwide use.

Indefinite-Delivery, Indefinite-Quantity contract

An IDIQ is a contract that fixes the terms and prices for work whose exact quantity and timing are unknown, obliges the government to order at least a stated minimum, and delivers the actual work through task or delivery orders placed against it.

The micro-purchase threshold is the level below which the government may buy without obtaining competitive quotations, set by FAR 2.101 at $15,000 generally, but at $2,000 for construction subject to the Davis-Bacon wage requirements and $2,500 for services subject to the Service Contract Labor Standards.

Simplified Acquisition Threshold (SAT)

The simplified acquisition threshold is the dollar level below which agencies may use the streamlined buying procedures in FAR Part 13, and FAR 2.101 currently sets it at $350,000 with higher figures for contingency and humanitarian operations.

A sole-source award is a contract made without full and open competition, permitted only on one of the statutory grounds in FAR 6.302 and normally requiring a written justification and approval, or under the specific sole-source authorities of the small-business programs.

A task or delivery order is the instrument that buys actual work under an existing indefinite-delivery contract — services on a task order, supplies on a delivery order — using terms already fixed by the underlying contract.

Time-and-Materials contract (T&M)

A time-and-materials contract buys labour at fixed hourly rates that include overhead and profit, plus materials at cost, and the FAR treats it as the least preferred type because it gives the contractor no incentive to control hours.

8(a) Business Development program

The 8(a) Business Development program is a nine-year SBA program for small businesses at least 51% owned and controlled by U.S. citizens who are socially and economically disadvantaged, and participation makes a firm eligible for 8(a) set-aside and sole-source contracts.

Historically Underutilized Business Zone program

HUBZone is an SBA program for small businesses whose principal office is located in a Historically Underutilized Business Zone and at least 35% of whose employees live in a HUBZone, and certification makes a firm eligible for HUBZone set-aside and sole-source contracts.

A joint venture is two or more firms combining to pursue a specific contract, and SBA's rules allow a small business to joint venture with a larger firm without the two being treated as affiliates when the arrangement fits an approved exception.

On a set-aside contract, FAR 52.219-14 caps how much of the amount the government pays may go to subcontractors that are not similarly situated entities: 50% for services and for supplies, 85% for general construction and 75% for construction by special trade contractors.

The rule of two is the requirement that a contracting officer set an acquisition above the simplified acquisition threshold aside for small business whenever there is a reasonable expectation that offers will be obtained from at least two responsible small business concerns and that award will be made at fair market prices.

Service-Disabled Veteran-Owned Small Business

An SDVOSB is a small business at least 51% owned and controlled by one or more veterans rated as service-disabled by the VA, and SBA certification through the VetCert program is now required to compete for SDVOSB set-aside and sole-source contracts.

A set-aside is a contract reserved for competition among a defined class of small businesses, so that firms outside the class cannot compete for it at all.

A size standard is the maximum size — stated as average annual receipts or as number of employees — at which a business still counts as small for a particular NAICS code, and it is what decides whether you may compete for a small-business set-aside.

A contractor team arrangement is either two or more companies forming a partnership or joint venture to act as a potential prime contractor, or a potential prime agreeing with other companies to have them act as its subcontractors under a specified contract or acquisition program.

Women-Owned Small Business federal contract program

The WOSB federal contract program reserves certain contracts for small businesses at least 51% owned and controlled by women who are U.S. citizens, with an EDWOSB tier for firms whose owners also meet SBA's economic-disadvantage limits.

Commercial and Government Entity code

A CAGE code is the five-character identifier the Defense Logistics Agency assigns to a specific facility of an entity doing business with the federal government, and it is issued automatically as part of SAM.gov registration for U.S. entities.

A capability statement is a one-page summary of what your firm does, what it has done, and how it is classified and certified, written for a contracting officer doing market research rather than for a commercial customer.

North American Industry Classification System code

A NAICS code is the six-digit classification the U.S. Census Bureau publishes for an industry, and on a federal solicitation the single code the buyer assigns decides which SBA size standard applies and therefore whether your business counts as small for that contract.

Product and Service Code

A PSC is the four-character code the federal government uses to classify what is being bought — the product or service itself — as opposed to NAICS, which classifies the industry that supplies it.

SAM.gov registration is the free federal registration a company must have — and keep active — to be awarded a federal contract, and it must be renewed annually.

Unique Entity ID

The Unique Entity ID is the twelve-character alphanumeric identifier the government assigns to an entity in SAM.gov, and it replaced the DUNS number as the federal government's entity identifier in April 2022.

A bid bond, called a bid guarantee in the FAR, is security pledged with your offer that you will sign the contract and furnish the required performance and payment bonds if you win, and failing to include one when required makes a sealed bid nonresponsive.

Wage Rate Requirements (Construction)

The Davis-Bacon Act, implemented in the FAR as Construction Wage Rate Requirements, requires laborers and mechanics on federal construction contracts in excess of $2,000 to be paid no less than the prevailing wage determined by the Secretary of Labor for the locality.

Defense Federal Acquisition Regulation Supplement

DFARS is the Department of Defense supplement to the FAR — it does not replace the FAR but adds DoD-specific policy and clauses on top of it, and its section numbers mirror the FAR part they supplement.

Federal Acquisition Regulation

The Federal Acquisition Regulation is the uniform body of rules governing how executive agencies buy supplies and services, codified at 48 CFR chapter 1 and organised into parts, subparts and sections that solicitations cite constantly.

The Miller Act requires performance and payment bonds on federal construction contracts exceeding $150,000, and gives unpaid subcontractors and suppliers a right of action on the payment bond because they cannot lien federal property.

A payment bond is a surety's guarantee that the contractor will pay its subcontractors and suppliers, and on federal work it is the substitute for the mechanic's lien that cannot be placed against government property.

A performance bond is a surety's guarantee to the government that the contract will be completed according to its terms, furnished after award and required on federal construction contracts above the Miller Act threshold.

Service Contract Labor Standards

The Service Contract Act, implemented in the FAR as Service Contract Labor Standards, requires service contracts over $2,500 to pay service employees no less than the wages and fringe benefits determined by the Department of Labor for the locality.

A subcontracting plan is the document a large prime must submit committing to subcontract a share of the work to small businesses, required under FAR 19.702 when a contract is expected to exceed $900,000, or $2 million for construction, and subcontracting possibilities exist.

A wage determination is the Department of Labor's published schedule of minimum wage rates and fringe benefits for each labour classification in a locality, incorporated into a solicitation so that bidders price the same labour floor.

A bid protest is a formal challenge to a solicitation, a cancellation, or an award, and it can be filed with the contracting agency itself, with the Government Accountability Office, or with the U.S. Court of Federal Claims.

A contracting officer is the only person with authority to enter into, administer or terminate a federal contract on behalf of the government, and that authority is limited by a written warrant that states its dollar limits.

Contractor Performance Assessment Reporting System

CPARS is the federal system in which agencies record contractor performance evaluations, which are then available to source-selection officials on future competitions — making your CPARS record a direct input to whether you win again.

A debriefing is the agency's explanation of how your proposal was evaluated and why it did not win, available on request in negotiated procurements, and the timing of a required debriefing also controls the deadline for a protest that stops performance.

A GAO protest is a bid protest filed with the Government Accountability Office, which must decide it within 100 calendar days, and which has strict filing deadlines — solicitation challenges before proposals are due, other grounds within 10 days of when you knew or should have known of them.

A novation is the government's formal recognition of a new contractor in place of the original one — necessary because a federal contract cannot simply be assigned when a business is sold, merged or restructured.

Past performance is the record of how well you performed previous contracts, used as an evaluation factor in most negotiated procurements, and a firm with no relevant record must be evaluated neither favourably nor unfavourably on it.