CONTRACT LIASION TRAINING

Welcome to the Department of Military Affairs (DMA)contract liaison training. Your commitment to learning more about the contract liaison process will greatly benefit your program and will allow the department to gain greater control over the contracted services. The next few pages will help you learn the basic requirements and responsibilities associated with being named contract liaison, in contracts issued by the DMA.

At the end of this reading, you will be able to:

  • Describe your role in the contract process
  • Justify contract expenditures, and
  • Interpret contract requirements

Did you know that a majority of the services provided by the agency are in the form of contracted services? The agency has approx.175 contracts in place with private contractors to provide goods, services, or lease space. The agency pays approximately $60,000,000 annually for these contracted services. The agency contracts with approximately 140 different contractors to provide these services. The agency has identified several different contract liaisons to oversee all of these contracts.

Contract liaisons provide an internal control structure for the allocation of efficient and effective services. All issues and concerns regarding contracted services must flow through the contract liaison. This role is very important in the contract management process and is critical to the success of the agency’s overall mission and goals. Contract liaisons are the key point of contact for the agency and the contractor.

Before we get too far along, let’s quickly define a few commonly used contract terms:

  • Contract:
  • A legally binding promise, enforceable by law
  • An agreement between parties, with binding legal and moral force, usually exchanging goods or services for money or other consideration
  • Contract Administration: the management of all actions that must be taken to assure compliance with the terms of the contract after the award of the contract.
  • Contract Amendment: an agreed addition to, deletion from, correction or modification of a contract.
  • Contractor: any individual or business having a contract with the governmental body to furnish goods, services, or construction for a certain price.
  • Liaison: one that maintains communication, a close relationship, connection, or link.

Let’s take a look at the basic contract language and some specific contract terms.

  • The first section of a contract is “Parties” this section simply identifies the parties to the contract. It also includes such information as addresses and phone numbers.
  • Section 4 of the contract is Duties and Responsibilities. This section is the “nuts & bolts” of any contract, it contains the entire scope of work and should clearly detail the services to be provided by the contractor. Failure to be specific here can be very problematic down the road.
  • The consideration/payment section must clearly define the payment schedule that will be used to compensate the contractor for services provided. Normally, this should be listed as a specific rate per unit and the unit must be defined in the contract. Some contracts may be compensated on achievement of particular milestones or deliverables. Others compensate the contractor on a weekly basis, generally one time only contracts compensate the contractor upon completion of the project. Regardless of the compensation schedule used, it must be measurable by the contractor and the liaison.
  • Effective Date/Duration, and Renewal. This section defines the specific date of services and may include options to renew upon expiration of the initial contract period.
  • Liaisons and Service of Notice. This is your section, all communications with the contractor or the department should flow through the individuals listed. This section also includes specific instructions regarding formal notices should that be necessary.
  • Required Insurance. In almost all cases the contractor is required to purchase and maintain insurance while providing services to the agency. The amount and type of insurance is dependent upon the services provided and the risk associated with said services.
  • Amendments. As clearly stated; both parties must agree to contract changes in writing. Neither party can arbitrarily change the scope of services without written consent of the other party.
  • Integration. This section reiterates the fact that all changes to the contract must be agreed to by both parties. All requests to amend the contract, by the contract liaison for the department, must be submitted to the DMA Contracts Officer for processing.
  • Completed Contract. The department requires a signed contract before payment for contracted services. Contract liaison should not allow the contractor to begin work until the contract has been signed by both parties.

So, what is your role as a contract liaison? As a contract liaison you are responsible for developing and maintaining a mutually respectable working relationship with the contracted vendor. Such a relationship, based upon trust, is essential to the successful delivery of contracted services. All communications between the contracted parties should flow through the contract liaison.

The contract liaison is responsible for oversight of the contracted services on a day to day basis. This includes working with the contractor to coordinate the delivery of services at department locations or at the contractor’s on-site location, as appropriate.

The contract liaison is responsible for monitoring contracted services to ensure that services are being provided in accordance with the contract terms. This allows the contract liaison to immediately address service deficiencies and/or other contract issues, before they become problematic. Contract monitoring provides an internal control to verify that the appropriate services are being provided.

The contract liaison is responsible for identifying and requesting contract changes that are generally beneficial to the agency and result in a more efficient delivery of services and/or reduced cost to the agency. Changes may also be necessary to more specifically define duties and responsibilities of the contactor, or the agency. A request for contract changes must be submitted to the DMA ContractingOfficer so that he/she can create a contract amendment for approval and routing.

Typically the contract liaison is solely responsible for approval of an invoice for contracted services. Approval of the invoice by the contract liaisonauthorizes payment by the accounting department. It also guarantees that the contracted services have been provided by the contractor in accordance with the contract terms, and that the contractors billing is also in accordance with contract payment terms. In addition to the contract liaisons signature, invoice approval shall include the contract number, proper account code, fund, subclass and organization number, and the date of invoice approval.

As the contract liaison you should play a significant role in the negotiation of contracted services, and subsequently the payment terms and schedule. In fact, often times the contract liaison maybe directed by their supervisor to individually represent the agency or program during contract negotiations; therefore it is important that the contract liaison maintain accurate records of contractor performance and communications between the parties.

The contract renewal process is another very important step in the contract liaison process. Renewal procedures typically involve all of the steps previously discussed. As part of the contract management process, the DMA Contracting Officer or State Procurement Bureauwill notify the contract liaison that a contract expiration date is approaching. Notice will be provided at least once beginning not less than 60-90 days prior to the expiration date. It is the contract liaison responsibility to contact the vendor to verify that they are interested in renewing the contract (using the renewal letter attached). Most importantly, the liaison must discuss with the contractor the specific terms and conditions of the renewal which includes pricing. Therefore, information gathered by the contract liaison during day to day oversight of the contracted services will likely impact the department’s decision to request a contract extension or renewal from the contractor and could prove critical to any negotiations with the contractor. This is the time to discuss necessary contract changes if they have not been addressed previously. If no contract changes are necessary the contract liaison shall notify the DMA Contracting Officer to proceed with renewal. If contract changes are necessary, the contract liaison shall notify the DMA Contracting Officer that changes will be necessary and that discussions with the contractor will be held. Once concluded, the contract liaison shall notify the DMA Contracting Officer in writing of the necessary changes along with a purchase requisition and the DMA Contracting Officer will proceed with an amendment as appropriate.

The contract liaison is required to submit specific contract reporting information to the DMA Contracting Officer in accordance with the format requested. These reports will be provided frequently and will verify provision of services. These contract reportswill be forwarded to the Program Administrator and the DMA Contracting Officer.

Let’s review the contract liaison principles.

  • As contract liaison you must be fully aware of the services provided by the contractor
  • Be fully cognoscente of the reason and intent of the contracted services and the overall goals the contractor is expected to achieve by providing services at your facility or department.
  • Understand the basic contract terms and in particular payment terms and the correlating provision of services.
  • Verify that the contractor is providing the contracted services in accordance with the contract. In many cases the contractor should be required to produce reports for your review that will help substantiate the provided services.

Don’t be afraid to ask “why”. Ask the contractor; ask your supervisor, manager, or program administrator. Ask the DMA Contracting Officer. The additional information will provide you with a more complete understanding of the contracted services you have been assigned to monitor.

Your contract liaison training is now nearly complete. In summary, we trust that you have found this training informative, you understand your role as a contract liaison, you’re now able to interpret basic contract terms, and you are familiar with approval and justification of contractor/vendor invoices.

If you should have any questions regarding this training or your role as a contact liaison, please contact your supervisor, program administrator or DMA Contracting Officer.