FEDERAL PROCUREMENT ADR OVERVIEW Presented by Honorable Candida Steel Chair, Department of Interior Board of Contract Appeals Mr. David Emmerson Department.

FEDERAL PROCUREMENT FEDERAL PROCUREMENT ADR OVERVIEWADR OVERVIEW

Presented byPresented by

Honorable Candida SteelHonorable Candida SteelChair, Department of InteriorChair, Department of InteriorBoard of Contract AppealsBoard of Contract Appeals

Mr. David EmmersonMr. David EmmersonDepartment of the Interior,Department of the Interior,

Office of Collaborative Action and Dispute Office of Collaborative Action and Dispute ResolutionResolution

April 1, 2003April 1, 2003

TOPICSTOPICS

ADR – Relevant Statutes and RegulationsADR – Relevant Statutes and Regulations

Federal Interagency ADR Working GroupFederal Interagency ADR Working Group

DOI Policy and Role of CADR officeDOI Policy and Role of CADR office

Bid Protest ADRBid Protest ADR

Contract Dispute ADRContract Dispute ADR

ADR ProcessesADR Processes

DOI plans for the future – your roleDOI plans for the future – your role

ADR Statutes and RegulationsADR Statutes and RegulationsAdministrative Dispute Resolution Act of 1996 Administrative Dispute Resolution Act of 1996 (“ADRA”)(“ADRA”)- Requires each Federal agency to:- Requires each Federal agency to:

-Adopt a policy on the use of alternative means of -Adopt a policy on the use of alternative means of dispute resolution (DOI policy since 1994)dispute resolution (DOI policy since 1994)-Designate a senior official to be the agency’s dispute -Designate a senior official to be the agency’s dispute resolution specialist, responsible for implementation resolution specialist, responsible for implementation of the Act and the agency’s policy (Elena Gonzalez, of the Act and the agency’s policy (Elena Gonzalez, Director of CADR, is DOI’s Dispute Resolution Director of CADR, is DOI’s Dispute Resolution Specialist)Specialist)

-review each standard agreement for contracts, -review each standard agreement for contracts, grants and other assistance to determine whether to grants and other assistance to determine whether to amend such standard agreements to authorize and amend such standard agreements to authorize and encourage the use of alternative means of dispute encourage the use of alternative means of dispute resolutionresolution

ADR Statutes and RegulationsADR Statutes and Regulations

ADRA of 1996ADRA of 1996

- - Authorizes use of either federal (internal) or private Authorizes use of either federal (internal) or private (outside) compensated neutrals(outside) compensated neutrals

- - Specifies factors to consider for not using ADRSpecifies factors to consider for not using ADR

- - Authorized use of binding arbitration based on agency Authorized use of binding arbitration based on agency guidance formulated with Justice Department inputguidance formulated with Justice Department input

- - Called for President to establish an “interagency Called for President to establish an “interagency committee” to facilitate ADR usecommittee” to facilitate ADR use

- - Set forth ADR confidentiality requirements for parties Set forth ADR confidentiality requirements for parties as well as for ADR neutralsas well as for ADR neutrals

ADR – Statutes and RegulationsADR – Statutes and Regulations

Contract Disputes Act (“CDA”) Contract Disputes Act (“CDA”) (41 U.S.C. §605)(41 U.S.C. §605)– Expressly permits use of voluntary ADR for dispute Expressly permits use of voluntary ADR for dispute

resolution under the CDAresolution under the CDA– Requires the Government to provide written Requires the Government to provide written

justification for rejecting a contractor request for ADRjustification for rejecting a contractor request for ADR

ADR – Statutes and RegulationsADR – Statutes and Regulations

Federal Acquisition Regulation (“FAR”)Federal Acquisition Regulation (“FAR”)– Section 33.204 sets forth as Government Section 33.204 sets forth as Government

policy the encouragement of ADR use “to the policy the encouragement of ADR use “to the maximum extent practicable”maximum extent practicable”

– Section 33.214 implements the ADRA as well Section 33.214 implements the ADRA as well as the requirement of CDA Section 605 for as the requirement of CDA Section 605 for written justification for rejection of a contractor written justification for rejection of a contractor request for ADRrequest for ADR

Interagency ADR Working GroupInteragency ADR Working Group

President’s Memorandum to Agency President’s Memorandum to Agency Heads dated May 1, 1998Heads dated May 1, 1998– Established the Interagency ADR Working Established the Interagency ADR Working

Group under the Attorney General pursuant to Group under the Attorney General pursuant to the ADRA’s requirement for an “interagency the ADRA’s requirement for an “interagency committee”committee”

– Authorized establishment of “subgroups” for Authorized establishment of “subgroups” for “subject areas”“subject areas”


President’s Memorandum to Agency President’s Memorandum to Agency Heads dated May 1, 1998Heads dated May 1, 1998– Called for Interagency ADR Working Group Called for Interagency ADR Working Group

to facilitateto facilitate development of agency ADR programsdevelopment of agency ADR programs

ADR awareness and skills trainingADR awareness and skills training

development of procedures for expedited development of procedures for expedited procurement of ADR neutrals servicesprocurement of ADR neutrals services

evaluation of ADR benefitsevaluation of ADR benefits

Interagency ADR Working GroupInteragency ADR Working GroupDOI has a member of the Interagency ADR DOI has a member of the Interagency ADR Working Group Steering Committee since 1999 Working Group Steering Committee since 1999 and the Secretary designated Elena Gonzalez to and the Secretary designated Elena Gonzalez to represent DOI represent DOI Items developed by the Interagency ADR Items developed by the Interagency ADR Working Group Steering Committee under the Working Group Steering Committee under the auspices of the Federal ADR Council and posted auspices of the Federal ADR Council and posted on the Working Group website (on the Working Group website (http://www.http://www.adradr..govgov) include:) include:– ADR Confidentiality GuidelinesADR Confidentiality Guidelines– Core Principles for Federal Workplace ADRCore Principles for Federal Workplace ADR– Handbook entitled “Developing Guidance for Binding Handbook entitled “Developing Guidance for Binding

Arbitration”Arbitration”

Interagency ADR Working GroupInteragency ADR Working Group4 Sections established by Interagency ADR 4 Sections established by Interagency ADR Working Group by subject matter:Working Group by subject matter:

1. 1. Contracts and ProcurementContracts and Procurement

2. Workplace2. Workplace3. Civil Enforcement and Regulatory3. Civil Enforcement and Regulatory4. Claims Against the Government4. Claims Against the Government

-DOI’s application of ADR processes is broader than -DOI’s application of ADR processes is broader than these sections and that is recognized by the these sections and that is recognized by the Interagency ADR Working Group Steering Committee Interagency ADR Working Group Steering Committee – e.g. collaborative decision-making on natural – e.g. collaborative decision-making on natural resource issues resource issues


Contracts and Procurement Section of Contracts and Procurement Section of Interagency ADR Working Group:Interagency ADR Working Group:– Co-Sponsors Procurement ADR Seminar Series with Co-Sponsors Procurement ADR Seminar Series with

the American Bar Associationthe American Bar Association– Initiation and Coordination of the Office of Federal Initiation and Coordination of the Office of Federal

Procurement Policy (OFPP) Procurement ADR Procurement Policy (OFPP) Procurement ADR Awards ProgramAwards Program

– Development and Maintenance of the “Electronic Development and Maintenance of the “Electronic Guide to Federal Procurement ADR” – Guide to Federal Procurement ADR” – http://www.adr.af.mil.iadrwghttp://www.adr.af.mil.iadrwg


Contract and Procurements SectionContract and Procurements Section– “ “Electronic Guide to Federal Procurement Electronic Guide to Federal Procurement

ADR” includes sections on ADR” includes sections on ADR Program DesignADR Program Design Administering the ADR ProcessAdministering the ADR Process ADR TrainingADR Training ADR NeutralsADR Neutrals Agency ADR ProfilesAgency ADR Profiles List of ADR MentorsList of ADR Mentors Sample ADR FormsSample ADR Forms Links to Federal ADR WebsitesLinks to Federal ADR Websites

DOI’s ADR PolicyDOI’s ADR Policy

DOI published a final policy on the use of ADR in DOI published a final policy on the use of ADR in August of 1996 – it is currently being updated to August of 1996 – it is currently being updated to reflect developments since 1996, such as reflect developments since 1996, such as establishment of CADR office and the Interior establishment of CADR office and the Interior Dispute Resolution CouncilDispute Resolution CouncilDOI’s policy encourages the broadest possible DOI’s policy encourages the broadest possible use of ADR processes, consensus-building use of ADR processes, consensus-building techniques and negotiated rulemaking to techniques and negotiated rulemaking to prevent and resolve disputes whenever prevent and resolve disputes whenever practicable and consistent with existing law and practicable and consistent with existing law and the missions and resources of the Departmentthe missions and resources of the Department

Goal of DOI’s ADR policyGoal of DOI’s ADR policy

The goal of the Department’s ADR policy is to:The goal of the Department’s ADR policy is to:- improve the efficiency and effectiveness of our improve the efficiency and effectiveness of our

operations,operations,- improve communication internally and externally, improve communication internally and externally, - and strengthen working relationships with our and strengthen working relationships with our

customers and constituents, industry, private customers and constituents, industry, private organizations, local communities, and the other organizations, local communities, and the other Federal, State, Tribal, and local government Federal, State, Tribal, and local government entities with which we interact in our work.entities with which we interact in our work.

DOI Policy and CADR officeDOI Policy and CADR officeThe Department’s policy encourages use of The Department’s policy encourages use of these tools to manage conflicts that arise in all these tools to manage conflicts that arise in all areas of the Department’s work, including:areas of the Department’s work, including:

- workplace/employment concerns- workplace/employment concerns

- programmatic issues related to bureau and - programmatic issues related to bureau and office missions (wide range of applications, such office missions (wide range of applications, such as land management, water disputes, and civil as land management, water disputes, and civil enforcement)enforcement)

- negotiated rulemaking and public policy - negotiated rulemaking and public policy dialoguesdialogues

- procurement ( this will be our focus today)- procurement ( this will be our focus today)

CADR office CADR office During 2001, the Acting Assistant Secretary for During 2001, the Acting Assistant Secretary for Policy, Management and Budget, requested a Policy, Management and Budget, requested a Department-wide review of ADR use since Department-wide review of ADR use since establishment of the DOI policy in 1994.establishment of the DOI policy in 1994.A cross-functional team was established to A cross-functional team was established to conduct an internal review across all areas of conduct an internal review across all areas of the Department and to benchmark 26 other the Department and to benchmark 26 other Federal agencies.Federal agencies.A Report was issued in July of 2001, on “ADR at A Report was issued in July of 2001, on “ADR at a Crossroad at DOI”, with findings and next step a Crossroad at DOI”, with findings and next step recommendations. The report is available at recommendations. The report is available at www.doi.gov/cadr.www.doi.gov/cadr.

CADR officeCADR officeAs a result of this review, the Secretary As a result of this review, the Secretary established the Office of Collaborative Action established the Office of Collaborative Action and Dispute Resolution within the Office of the and Dispute Resolution within the Office of the Assistant Secretary for Policy, Management and Assistant Secretary for Policy, Management and Budget in October of 2001.Budget in October of 2001.This goal of this office is to foster a culture and This goal of this office is to foster a culture and a climate where the use of collaborative a climate where the use of collaborative processes and alternative means of dispute processes and alternative means of dispute resolution become standard business practice resolution become standard business practice throughout the Department, and conflicts are throughout the Department, and conflicts are prevented or resolved at the earliest opportunity prevented or resolved at the earliest opportunity and the lowest possible level in all areas of the and the lowest possible level in all areas of the Department’s work.Department’s work.

ObjectivesObjectives

The appropriate and effective use of ADR and The appropriate and effective use of ADR and collaborative and consensual approaches to collaborative and consensual approaches to planning, problem-solving and decision-making planning, problem-solving and decision-making can:can:– save time associated with conflictsave time associated with conflict– Reduce direct and indirect cost associated with Reduce direct and indirect cost associated with

conflictconflict– Produce more equitable and durable solutions and Produce more equitable and durable solutions and

policiespolicies– Improve communication and strengthen relationshipsImprove communication and strengthen relationships

CADR office CADR office

For more information on the work of the For more information on the work of the CADR office and the Interior Dispute CADR office and the Interior Dispute Resolution Council, please visit our Resolution Council, please visit our website at website at www.doi.gov/cadrwww.doi.gov/cadr..

The site is undergoing a major overhaul The site is undergoing a major overhaul and we welcome your suggestions and and we welcome your suggestions and input.input.

Bid Protest ADRBid Protest ADRAt the GAOAt the GAO– “ “Outcome Prediction”Outcome Prediction”– Negotiation Assistance (Facilitative Mediation)Negotiation Assistance (Facilitative Mediation)

At the U.S. Court of Federal ClaimsAt the U.S. Court of Federal Claims

Agency Based Protest ProceduresAgency Based Protest Procedures– Contemplated by the FARContemplated by the FAR– The FAA ODRA (not governed by the FAR) The FAA ODRA (not governed by the FAR)

Uses ADR as its primary means of dispute resolution and resolves Uses ADR as its primary means of dispute resolution and resolves 58% of all bid protests filed by means of ADR within 25 calendar 58% of all bid protests filed by means of ADR within 25 calendar daysdaysUnlike GAO, the FAA ODRA itself initiates the idea of voluntary Unlike GAO, the FAA ODRA itself initiates the idea of voluntary ADR and uses ADR neutrals who do not participate in the ADR and uses ADR neutrals who do not participate in the adjudication of protestsadjudication of protests

Contract Dispute ADRContract Dispute ADR

At the U.S. Court of Federal Claims – Pilot ProgramAt the U.S. Court of Federal Claims – Pilot ProgramAt the IBCAAt the IBCA– Types of ADR currently offered: Mediation; Early Neutral Types of ADR currently offered: Mediation; Early Neutral

Evaluation/Settlement Judge; Summary Trial with Binding Evaluation/Settlement Judge; Summary Trial with Binding DecisionDecision

– Available NeutralsAvailable NeutralsIBCA Judges as ADR NeutralsIBCA Judges as ADR NeutralsOther BCA Judges as ADR Neutrals (BCA ADR Sharing Other BCA Judges as ADR Neutrals (BCA ADR Sharing Arrangement)Arrangement)Outside Compensated Neutrals (CADR office maintains information Outside Compensated Neutrals (CADR office maintains information on qualified neutrals and provides guidance on how to select and on qualified neutrals and provides guidance on how to select and procure the services of an outside neutral)procure the services of an outside neutral)

– Stipulated Judgments and access to the Judgment FundStipulated Judgments and access to the Judgment Fund– Pre-”Dispute” ADR/Dispute AvoidancePre-”Dispute” ADR/Dispute Avoidance

The ADR ProcessThe ADR Process

Deciding on ADR Use – parties must jointly Deciding on ADR Use – parties must jointly determine whether an ADR process is determine whether an ADR process is appropriate and which process will meet their appropriate and which process will meet their needsneedsADR Players and RolesADR Players and RolesThe ADR Agreement The ADR Agreement Preparing for ADRPreparing for ADRDeciding to SettleDeciding to SettleMemorializing the Settlement Agreement Memorializing the Settlement Agreement


Deciding on ADR UseDeciding on ADR Use– ADRA of 1996ADRA of 1996– DOI Policy and GuidelinesDOI Policy and Guidelines– DOJ GuidelinesDOJ Guidelines


ADR Players and RolesADR Players and Roles– Contracting Officer: retains authority to Contracting Officer: retains authority to

negotiate/settlenegotiate/settle– Legal counsel: Legal counsel:

Provides advice on legalityProvides advice on legality Provides assessment of litigation riskProvides assessment of litigation riskHelps determine whether ADR is appropriateHelps determine whether ADR is appropriate Helps present issues and facts Helps present issues and facts Helps prepare settlement agreementsHelps prepare settlement agreements


ADR Players and RolesADR Players and Roles– The ADR Neutral:The ADR Neutral:

Assists parties with formulation of ADR process/proceduresAssists parties with formulation of ADR process/procedures Counsels parties on efficient use of fact-finding and Counsels parties on efficient use of fact-finding and discovery in advance of ADR proceedingsdiscovery in advance of ADR proceedings May provide evaluation of merits May provide evaluation of merits if desired by partiesif desired by parties – – including views on strengths and weaknesses of parties’ including views on strengths and weaknesses of parties’ respective positions, should the matter be litigatedrespective positions, should the matter be litigated Focuses the parties’ attention on the issues requiring Focuses the parties’ attention on the issues requiring resolution and may narrow the scope of litigationresolution and may narrow the scope of litigation Facilitates and maintains discussion/negotiation Facilitates and maintains discussion/negotiation May recommend settlement scenarios with agreement of the May recommend settlement scenarios with agreement of the partiesparties


The ADR Agreement – Parties’ agreement to The ADR Agreement – Parties’ agreement to use ADR processuse ADR process– Written agreement highly desirableWritten agreement highly desirable– Identifies ADR Neutral, his/her role, and how Neutral Identifies ADR Neutral, his/her role, and how Neutral

is compensated (not applicable to IBCA Judges)is compensated (not applicable to IBCA Judges)– Spells out process/procedures to be usedSpells out process/procedures to be used– Sets timetable for submissions and proceedingsSets timetable for submissions and proceedings– Provides for termination of ADR processProvides for termination of ADR process– Provides for bounds of ADR confidentiality and how Provides for bounds of ADR confidentiality and how

materials may be used if matter ultimately requires materials may be used if matter ultimately requires litigationlitigation


Preparation for ADRPreparation for ADR– Fact-finding/discovery – ADR Neutral’s assistance in Fact-finding/discovery – ADR Neutral’s assistance in

helping the parties to streamline the processhelping the parties to streamline the process– Defining issues to be resolved – ADR Neutral can Defining issues to be resolved – ADR Neutral can

play an important role in helping the parties play an important role in helping the parties – Designation of negotiation principals with settlement Designation of negotiation principals with settlement

authority – critical for successful negotiation processauthority – critical for successful negotiation process– Prepare/submit brief position statements in advance Prepare/submit brief position statements in advance

of ADR proceedings – crystallize the reasons for of ADR proceedings – crystallize the reasons for positions taken; incorporate “key” documentspositions taken; incorporate “key” documents


Deciding to SettleDeciding to Settle– Risk assessment is essential – roles of legal Risk assessment is essential – roles of legal

counsel and ADR Neutralcounsel and ADR Neutral– Evaluation of Costs & Benefits – Consider:Evaluation of Costs & Benefits – Consider:

Relative strengths and weaknesses of positions, Relative strengths and weaknesses of positions, both on specific claims and overallboth on specific claims and overall Costs of litigation in terms of dollars, time and Costs of litigation in terms of dollars, time and diverted resources (impact on the Agency’s diverted resources (impact on the Agency’s program) program) Benefits of settlement in terms of maintaining Benefits of settlement in terms of maintaining cordial business relationships, particularly where cordial business relationships, particularly where contract is ongoingcontract is ongoing


Memorializing the SettlementMemorializing the Settlement– Require a written settlement agreementRequire a written settlement agreement– Have parties sign a preliminary agreement Have parties sign a preliminary agreement

(Memorandum of Understanding) before (Memorandum of Understanding) before leaving the ADR sessionleaving the ADR session

– Adapt available form agreements (see Adapt available form agreements (see “Electronic Guide”)“Electronic Guide”)

– Make sure signatories have authorityMake sure signatories have authority– Funding – Contract Modifications and/or Use Funding – Contract Modifications and/or Use

of Stipulated Judgments and the Judgment of Stipulated Judgments and the Judgment FundFund

Where do we go from here?Where do we go from here?

The Office of Collaborative Action and Dispute The Office of Collaborative Action and Dispute Resolution will be working with the Interior Board Resolution will be working with the Interior Board of Contract Appeals and the Office of Acquisition of Contract Appeals and the Office of Acquisition and Property Management to design a flexible and Property Management to design a flexible and effective conflict management system to and effective conflict management system to promote the appropriate use of ADR processes promote the appropriate use of ADR processes to address conflicts that arise in the to address conflicts that arise in the Department’s procurement and grants work. Department’s procurement and grants work. We will need your input and assistance to be We will need your input and assistance to be successful. Dee Emmerich in the PAM office successful. Dee Emmerich in the PAM office represents your interests on the Interior Dispute represents your interests on the Interior Dispute Resolution Council. Please feel free to Resolution Council. Please feel free to communicate with her or with either of us.communicate with her or with either of us.

FEDERAL PROCUREMENT ADR OVERVIEW Presented by Honorable Candida Steel Chair, Department of Interior Board of Contract Appeals Mr. David Emmerson Department.

Documents

adr slide

adr statutes

encouragement of adr

use of voluntary adr

topics adr relevant

skills training adr

federal agency

role slide