FAR 14.5—Subpart 14.5

General.

FAR 14.501 explains the purpose and structure of two-step sealed bidding, a hybrid source-selection method used when the Government wants the price competition and award procedures of sealed bidding but does not yet have specifications detailed enough for ordinary sealed bidding. The section covers when the method is useful, especially for complex items and acquisitions that require technical proposals, and it explains the two-step process itself: step one for requesting, submitting, evaluating, and possibly discussing technical proposals without pricing, and step two for receiving sealed priced bids only from offerors whose technical proposals were found acceptable. It also clarifies that the goal of step one is to determine technical acceptability, including matters such as engineering approach, special manufacturing processes, and special testing techniques, and that step one is the proper stage to resolve technical questions. The section further distinguishes technical acceptability from responsibility determinations under FAR Part 9, and it states that step-two bids are evaluated and awards are made under the sealed bidding rules in FAR subparts 14.3 and 14.4. In practice, this section matters because it lets agencies refine requirements before price competition, while giving contractors a fair chance to compete on price only after technical issues are settled.

Conditions for use.

FAR 14.502 explains when contracting officers may use two-step sealed bidding instead of negotiation, and what conditions must be present before choosing that method. It focuses on the relationship between incomplete or restrictive specifications, the need for technical evaluation and discussion, the existence of clear evaluation criteria, the availability of more than one technically qualified source, the time needed to conduct the process, and the requirement to award a firm-fixed-price or fixed-price-with-economic-price-adjustment contract. It also identifies several situations that do not bar use of two-step sealed bidding, including multi-year contracting, government-furnished property, various small business and socioeconomic set-asides and preferences, and acquisition of production quantities under a performance specification. In practice, this section helps agencies decide whether two-step sealed bidding is a suitable procurement strategy when technical uncertainty exists but price competition is still desired. For contractors, it signals that the Government may seek technical proposals first, then sealed price bids only from technically acceptable sources.

Procedures.