How to Use Contractor Team Arrangements
What is a Contractor Team Arrangement? GSA defines a GSA Schedule Contractor Team Arrangement (CTA) as an arrangement in which two or more GSA schedule contractors team together to provide a total solution to meet a customer’s needs. The Schedules CTA does not create a separate legal entity, but allows Schedule contractors to meet buyer requirements by combining the supplies and/or services from each team member’s separate Schedule contract in response to a buyer’s Request for Quote (RFQ). CTAs are different from Prime/Subcontracting Agreements - more information about that here. It is important to note that Schedule CTA’s are different from FAR 9.6 Contractor Team Arrangements; Schedule CTAs require both participants to have a GSA Multiple Award Schedule Contract.
What are the benefits of a Contractor Team Arrangement?
For the government, allowing contractors to work together means they can get complete solutions from contractors with complimentary offerings. It also lets government buyers more easily satisfy their socioeconomic procurement goals.
GSA Schedule Contractors can use CTAs to compete for orders they otherwise wouldn’t be competitive on or wouldn’t qualify for. By working with other Schedule holders, contractors can offer a complete solution to meet an RFQ that neither partner would be capable of performing on their own. Contractors can also use CTAs to ensure that they only need to focus on their own core competencies, reducing risk of nonperformance and ensuring the government receives the best price and quality possible. Small businesses may team together or with a larger business to take on a large project they would be unable to handle alone.
GSA’s socioeconomic procurement goals can give contractors using CTAs an advantage over the competition. If an RFQ has socioeconomic requirements tied to it, then all members of the CTA must meet those requirements. However, even on RFQs that are not set-aside for specific socioeconomic categories, GSA prefers to work with small and disadvantaged businesses wherever possible in order to meet their overall spending goals. Contractors can also work together to compete for RFQs outside the scope of their awarded Schedule or SINs. When looking to use a CTA in this manner, however, it is important to read the RFQ closely, as some will require all CTA members to have the applicable schedule and SIN.
How do I form a Contractor Team Arrangement?
GSA Schedule holders are free to establish CTAs at any time, and the contractors themselves are responsible for the creation of the document. While GSA does not provide a template for CTAs, they do recommend that contractors include the following elements:
- Duration of the agreement. Define the duration of the partnering agreement, identify any options, and describe how each option will work.
- Team Leader. Provide detailed outline of Team Leader responsibilities and specify the contractor who will perform as the Team Leader. If the Team Leader will change throughout the order performance period, the document should describe the reasons for such changes and how the Team Leader will be designated during order performance.
- Team Members. Specify the responsibilities of each Team Member and any limitations on those responsibilities.
- Communications. CTAs should outline points of contact for each Team Member (contractor). Since the government has privity with all Team Members, the buyer may communicate directly with CTA Team Members.
- Invoicing and Payments. Designate team responsibilities for invoicing and payment. The CTA document should clearly indicate that all Team Members agree to the method of payment. The CTA Agreement should acknowledge that the Team Members, without any involvement by the government, would resolve any dispute involving the distribution of payment between the Team Leader and the Team Members.
- Legal Relationship. The CTA document must not create a joint venture or separate subsidiary. Each Team Member is operating as a “prime” for the portion of work they are performing.
- Delivery responsibility. State whether the Team Leader or each member is responsible for a particular part of the project, so that delivery responsibility is clearly established.
- Confidential information. Identify any proprietary information and specify how such proprietary information and related rights will be managed.
- Identification of parties. The CTA Agreement should:
- Be documented in writing and signed by each participating GSA Schedule contractor
- Identify each member of the CTA by name, address, GSA Schedule contract number, and Point of Contact (POC)
- State the name and address of the ordering activity
- State that the agreement is solely between the team members
- Conflicting Terms. The CTA Agreement shall not conflict with the terms and conditions of each team member’s FSS contract. In the event of a conflict, the FSS contract shall take precedence.
- Specific team activities. State the various types of activities that will be incorporated into the team arrangement and identify who is primarily responsible for each identified activity.
- Independent contractors. The CTA Agreement should state that all Team Members remain independent contractors, responsible for their own employees.
- Replacement of team members. Address the circumstances and procedures for replacement of Team Members, including the Team Leader, and should state that the team must obtain the approval of the ordering activity prior to replacing any team member after receipt of an order.
- Performance evaluation. Clarify under whose name the government should evaluate performance in CPARS. FAR 8.406-7 requires ordering activities to enter evaluations in CPARS for all orders exceeding the Simplified Acquisition Threshold (SAT).
- Reporting of sales and Industrial Funding Fee (IFF) payment responsibility. Specify that each team member is responsible for tracking and reporting its own sales IAW the terms and conditions of the FSS contract and for paying the related IFF.
- Pricing. Specify unit prices or hourly rates and how pricing is calculated; list the supplies/services and pricing, including any team lead task management pricing, if applicable; note that all prices charged to the buyer must be at or below the applicable contractor’s FSS contract prices; and explain how any order incentives or fees will be divided within the team if applicable.
- Liabilities. Document each Team Member’s responsibilities and performance requirements, so that liability is clearly established.
- Ordering procedures. Document how the team will handle processing orders from the government.
If you are looking to form a Contractor Team Arrangement, top expand your GSA Contract in other ways, or to begin the process of procuring a GSA Schedule Contract, we can help!
About Wesley Clark
Wesley Clark is a consultant in Winvale's Philadelphia office. His focus is on government contracting and federal acquisition opportunities for businesses. He is a native of Oxford, Pennsylvania and graduated from Villanova University with a Bachelor’s of Business Administration in Marketing and International Business.