By Jason Kaneshiro
DCMA Eastern Region Public Affairs
Editor's Note: This article was originally published in DCMA’s 2021 INSIGHT Magazine, which highlights the agency’s warfighter-support story and its global acquisition professionals who use insight and expertise to enhance that story each day. The online version of the magazine can be found here.
In August 2020, the Army Contracting Command was days away from awarding a contract for the rapid development of a COVID-19 vaccine worth more than $1 billion and sent an urgent request to DCMA to ensure responsible stewardship of taxpayer dollars.
The Army’s race to find a lifesaving vaccine is part of Operation Warp Speed, the federal government’s effort to deliver millions of safe doses of a COVID-19 vaccine as quickly as possible.
Air Force Col. James L. Vandross, manager of the DCMA Operation Warp Speed team, requested DCMA Atlanta’s Contracts team support the Army’s cost analysis.
The Contracts team partnered with the DCMA Cost and Pricing Regional Command Specialty Pricing Team and the Defense Contract Audit Agency to establish contract requirements and expedite the cost analysis to ensure allowability, allocability and reasonableness of the contract, said Nicole Bragg, DCMA Atlanta Contracts director.
“This team’s timely expert action prevented potential regulatory violations and excessive indirect costs,” Bragg said.
When the cost of the contract grew when the Army asked to include four additional contractors with their analysis while still meeting the initially agreed upon report due date, the team pulled together and accomplished the task.
“As result, the team’s analysis supported vaccine efforts for five contracts, totaling $6.8 billion,” Bragg said.
DeVonn Fray, Contracts supervisor, led the DCMA Atlanta team in identifying potential risks in the contractors’ proposed direct and indirect cost accounting structure.
“The contractors’ accounting system and approved rates are based on cost methodologies that comply with cost accounting standards,” said Fray. “Because the contractor is subject to federal cost accounting standards rules, they must allocate their indirect costs, including their general and administrative costs.”
However, due to the size, duration, expenditure rates and other characteristics of COVID-19-related projects, the contractor, procuring contracting officer and program executive officer teams believed those projects would receive a disproportionate allocation of general and administrative costs, Fray said.
“Thus, in accordance with the appropriate code of federal regulations, a special allocation review was requested of DCMA Atlanta,” Fray said.
To perform the special allocation review, the DCMA Atlanta team coordinated closely with the Special Contracts Cost and Pricing team. They hoped to gain a better understanding of the contractor’s compliant allocations and if it was appropriate to allow a special allocation for the Operation Warp Speed projects.
“Ultimately, a special allocation was deemed appropriate to ensure a disproportionate allocation of general and administrative costs were not provided,” Fray said.
“In times like these, when the military and government are in need of rapid and agile acquisition, DCMA has the capability and flexibility to respond with precision to fast-paced and critical requirements for COVID-19 countermeasures,” Bragg said.
He added that DCMA Atlanta’s contribution to these vital programs is another example of how the agency is the catalyst in value-based acquisition service.
Fray said she wants people inside and outside of the agency to realize DCMA does complex work in support of high-profile programs and missions.
“It’s important our (DCMA) folks realize that we are at the tip of the spear regarding major, news-worthy events that are changing and saving people’s lives,” Fray said. “Having the honor and privilege of working a contract of such dire need reminds our folks of the great impact they play each and every day.”
Fray said it was important for people to realize that DCMA’s work extends beyond supporting the warfighter.
“There is no greater life, health or safety concern in the world outside of COVID-19,” Fray said. “What’s cooler than bragging about our combined efforts to save all of humanity?”
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