Letters of Request · 2 of 3
A letter of request can come back in three forms, and they are not stages of the same thing. "USG responses to Letters of Request (LORs) include Price and Availability (P&A) for international competitions (see Section C4.3.1.) and building partner capacity (see Section C15.2.8.), Rough Order of Magnitude (ROM) Pricing, and Letters of Offer and Acceptance (LOAs) through the Foreign Military Sales (FMS) system" (SAMM C5.3.1).
Only the third commits anyone to anything. The first two are estimates carrying explicit disclaimers, and a buyer that treats either as a quotation will budget wrongly.
Any of the three can take one of three shapes. A hybrid mixes the two procurement routes. "Hybrid responses contain both FMS and DCS elements" (SAMM C5.3.1.1), and the commercially bought item "is not a line item on the LOA but is identified on the LOA as the end item for which the FMS support is provided". A negotiated response reflects a price the buyer settled with a company first, though "the contract price is as agreed between the IA's contracting officer and the company" (SAMM C5.3.1.2). A capped response is discouraged. "NTE or Firm Fixed Price (FFP) responses will not normally be provided" (SAMM C5.3.1.3), and a buyer asking for one pays the extra work it causes.
The lightest answer is a memorandum. "A ROM is an initial, non-binding cost estimate intended for planning and feasibility assessment, giving the foreign government or international organization (partner) a general idea of the potential cost and availability of defense articles or services" (SAMM C5.4.1). The status of the numbers is stated in the next line: "Furnishing this data does not constitute a commitment for the USG to offer for sale the articles and services" (SAMM C5.4.1).
It arrives within thirty days, and the first one comes out of the administrative surcharge rather than a case. The second one does not. "Any subsequent requests for the same item from the same partner will require a planning case LOA" (SAMM C5.4.1).
The content is prescribed. The estimate covers the whole capability rather than the headline item, taking in ancillary support equipment, integrated logistics support, training, an inflation adjustment and estimated administrative charges. Every memorandum also carries two standing disclaimers, one stating flatly that "The ROM pricing provided is not valid for the purpose of preparing an LOA" (SAMM Table C5.T7).
The second response is narrower than most people assume. It is prepared for two purposes only, international competitions and capacity building programs (SAMM C5.5). For everything else the answer is a rough order of magnitude.
Its standing is the same. "Furnishing of this information does not constitute a commitment for the USG to offer for sale the articles and services for which the information is provided" (SAMM C5.5.1), and more pointedly, "P&A responses are not valid for use in preparing a Letter of Offer and Acceptance (LOA)" (SAMM C5.5.2).
Ten data elements are specified, including the source of the figure, the assumptions used, and the key factors affecting it. That last category is the useful one for a buyer planning a timetable, since the examples given are a contract expiring on a stated date and a production line due to phase out (SAMM Table C5.T8).
The deadline is longer than for the lighter answer. "P&A data estimates will be provided to the prospective purchaser within 45 days of the request" (SAMM C5.5.5).
There is a caution about how these figures are discussed. "Economic, production, and budget uncertainties make it difficult to develop accurate cost and delivery estimates" (SAMM C5.5.3). Where officials talk to a partner about them, "Only specific data approved and provided by the IA or DSCA should be used" (SAMM C5.5.3). Figures picked up in a corridor are not figures.
The third response is a different kind of document altogether. "The Letter of Offer and Acceptance (LOA) is the legal instrument used by the USG to sell defense articles, defense services including training, and design and construction services to a foreign country or international organization under authorities provided in the Arms Export Control Act (AECA)" (SAMM C5.6.1).
It is an offer in the legal sense. "The LOA itemizes the defense articles and services offered and when implemented, becomes an official tender by the USG" (SAMM C5.6.1). And the boundary with the other two responses is drawn explicitly: "The LOA is not used to provide Price and Availability (P&A) data" (SAMM C5.6.1). What sits inside the document is set out in inside the letter of offer and acceptance.
There is no single answer, and the manual says so: "The time required to prepare LOA documents (LOAs, Amendments, and Modifications) varies with the complexity of the sale" (SAMM C5.6.2). Instead every document is assigned a category, and each category carries a published standard measured as a percentage delivered on time.
Slippage is tracked rather than hidden. Where an agency concludes it will miss the standard, it records an extenuating factor, an estimate of the delay, and afterwards the actual days taken. The case cannot be signed until that actual figure is entered (SAMM C5.6.2.1).
Ten factors are listed, several of them predictable from the buyer's side. They include a first purchase of a system, a first purchase by that country at all, engineering or integration work, and a use different from the American one. The rest are release coordination, congressional notification, waivers, an incomplete request and funding delays (SAMM Figure C5.F7).
A request can also be refused in part. Where an agency recommends disapproving major or sensitive equipment, or the whole request, it first works with the buyer, the combatant command and the office in country to remove or substitute the requirement (SAMM C5.3.2.1). If the buyer accepts a substitution, development continues from a new actionable date.
Where it does not, the matter escalates. The recommendation is coordinated across the state department, the policy and acquisition offices and the technology security agency, and the buyer is formally notified through the embassy. The notification sets out three options, cancelling the request, revising it, or continuing without the disapproved items, and it "will request a response from the purchaser within ten business days" (SAMM C5.3.2.1.2).
Routine training denials skip all of that. They are exempt from the coordination requirement, including courses closed to all foreign nationals, cancelled classes, quotas that cannot be met in the time wanted, and courses where attendance is by invitation (SAMM C5.3.2.2).
| ROM | Rough order of magnitude, a non-binding planning estimate delivered within thirty days. SAMM C5.4.1. |
|---|---|
| P&A | Price and availability, prepared only for international competitions and capacity building. |
| LOA | Letter of offer and acceptance, the legal instrument that makes the sale. |
| Hybrid response | An answer combining government and commercial elements on one requirement. |
| CDEF | Case development extenuating factor, the recorded reason a document will miss its standard. |
Every statement above links to the document behind it. The full source list for this piece is on the sources page.
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