Cost and Price Analysis (CPA)

7.0 COST AND PRICE ANALYSIS (CPA)

7.1 General. The Agency shall require assurance that, before entering a contract, the price is reasonable, in accordance with the following instructions. 

• 7.1.1 Micro Purchases. No formal cost or price analysis is required. Rather, the execution of a contract by the Contracting Officer (through a Purchase Order or other means) shall serve as the Contracting Officer's determination that the price obtained is reasonable, which may be based on the Contracting Officer's prior experience or other factors.
• 7.1.2 Sealed Bids. The presence of adequate competition should be sufficient to establish price reasonableness. Where sufficient bids are not received, and when the bid received is more than the ICE, and where the Agency cannot determine price reasonableness, the Agency must conduct a cost analysis, consistent with federal guidelines, to ensure that the price paid is reasonable.
• 7.1.3 Competitive Proposals. The presence of adequate competition should be sufficient to establish price reasonableness. Where sufficient proposals are not received, the Agency must compare the price with the ICE. For competitive proposals where prices cannot be easily compared among offerors, where there is not adequate competition, or where the price is greater than the ICE, the Agency must conduct a cost analysis, consistent with Federal guidelines, to ensure that the price paid is reasonable.
• 7.1.4 Contract Modifications. A cost analysis, consistent with federal guidelines, shall be conducted for all contract modifications for projects that were procured through Sealed Bids, Competitive Proposals, or Non-Competitive Proposals, or for projects originally procured through Micro Purchase procedures and the amount of the contract modification will result in a total contract price more than 25% of the original contract amount or if the contract exceeds $250,000.