[Federal Register Volume 63, Number 52 (Wednesday, March 18, 1998)]
[Rules and Regulations]
[Pages 13133-13134]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-7033]
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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 1816 and 1852
FAR Supplement Coverage of Award Fee Evaluations
AGENCY: National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
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SUMMARY: This is a final rule amending the NASA FAR Supplement (NFS)
coverage on award fee evaluations to correct inaccurate references and
improve clarity.
EFFECTIVE DATE: March 18, 1998.
FOR FURTHER INFORMATION CONTACT: Tom O'Toole, NASA Office of
Procurement, Contract Management Division (Code HK), (202) 358-0478.
SUPPLEMENTARY INFORMATION:
Background
NASA has different award fee evaluation procedures for service and
end item contracts. For service contracts, all award fee evaluations
during the contract term are final. For end item contracts, evaluations
during the contract term are ``interim'' evaluations that are
superseded by a single final evaluation at contract completion. The NFS
has inaccurate references associating interim evaluations with service
contracts, and these are deleted by this rule. In addition, NASA allow
for provisional payment of award fee, i.e., payments made during award
fee periods in anticipation of the Government evaluation at the end of
the period. References to provisional payments in the NFS are
inconsistent, and this rule conforms these references. Finally, to
improve its clarity, the NFS coverage is restructured and miscellaneous
editorial changes are made. None of the NFS revisions in this rule
change NASA policy.
Impact
NASA certifies that this regulation will not have a significant
economic impact on a substantial number of small business entities
under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.). This final
rule does not impose any reporting or recordkeeping requirements
subject to the Paperwork Reduction Act.
List of Subjects in 48 CFR Parts 1816 and 1852
Government procurement.
Deidre Lee,
Associate Administrator for Procurement.
Accordingly, 48 CFR Parts 1816 and 1852 are amended as follows:
1. The authority citation for 48 CFR Parts 1816 and 1852 continues
to read as follows:
Authority: 42 U.S.C. 2473(c)(1)
PART 1816-TYPES OF CONTRACTS
2. In section 1816.405-271, paragraph (a) is revised to read as
follows:
1816.405-271 Base fee.
(a) A base fee shall not be used on CPAF contracts for which the
periodic award fee evaluations are final (1816.405-273(a)). In these
circumstances, contractor performance during any award fee period is
independent of and has no effect on subsequent performance periods or
the final results at contract completion. For other contracts, such as
those for hardware or software development, the procurement officer may
authorize the use of a base fee not to exceed 3 percent. Base fee shall
not be used when an award fee incentive is used in conjunction with
another contract type (e.g., CPIF/AF).
* * * * *
3. In paragraph (a) of section 1816.405-272, the first sentence is
revised to read as follows:
1816.405-272 Award fee evaluation periods.
(a) Award fee evaluation periods, including those for interim
evaluations, should be at least 6 months in length. * * *
* * * * *
4. Section 1816.405-273 is revised to read as follows:
1816.405-273 Award fee evaluations.
(a) Service contracts. On contracts where the contract deliverable
is the performance of a service over any given time period, contractor
performance is often definitively measurable within each evaluation
period. In these cases, all evaluations are final, and the contractor
keeps the fee earned in any period regardless of the evaluations of
subsequent periods. Unearned award fee in any given period in a service
contract is lost and shall not be carried forward, or ``rolled-over,''
into subsequent periods.
(b) End item contracts. On contracts, such as those for end item
deliverables, where the true quality of contractor performance cannot
be measured until the end of the contract, only the last evaluation is
final. At that point, the total contract award fee pool is available,
and the contractor's total performance is evaluated against the award
fee plan to determine total earned award fee. In addition to the final
evaluation, interim evaluations are done to monitor performance prior
to contract completion, provide feedback to the contractor on the
Government's assessment of the quality of its performance, and
establish the basis for making interim award fee payments (see
1816.405-276(a)). These interim evaluations and associated interim
award fee payments are superseded by the fee determination made in the
final evaluation at contract completion. The Government will then pay
the contractor, or the contractor will refund to the Government, the
difference between the final award fee determination and the cumulative
interim fee payments.
(c) Control of evaluations. Interim and final evaluations may be
used to provide past performance information during the source
selection process in future acquisitions and should be marked and
controlled as ``Source Selection Information--See FAR 3.104''.
[[Page 13134]]
5. In section 1816.405-275, paragraph (b)(2) is revised to read as
follows:
1816.405-275 Award fee evaluation scoring.
* * * * *
(b) * * *
(2) Very good (90-81): Very effective performance, fully responsive
to contract requirements; contract requirements accomplished in a
timely, efficient, and economical manner for the most part; only minor
deficiencies.
* * * * *
6. Section 1816.405-276 is added to read as follows:
1816.405-276 Award fee payments and limitations.
(a) Interim award fee payments. The amount of an interim award fee
payment (see 1816.405-273(b)) is limited to the lesser of the interim
evaluation score or 80 percent of the fee allocated to that interim
period less any provisional payments (see paragraph (b) of this
subsection) made during the period.
(b) Provisional award fee payments. Provisional award fee payments
are payments made within evaluation periods prior to an interim or
final evaluation for that period. Provisional payments may be included
in the contract and should be negotiated on a case-by-case basis. For a
service contract, the total amount of award fee available in an
evaluation period that may be provisionally paid is the lesser of a
percentage stipulated in the contract (but not exceeding 80 percent) or
the prior period's evaluation score. For an end item contract, the
total amount of provisional payments in a period is limited to a
percentage not to exceed 80 percent of the prior interim period's
evaluation score.
(c) Fee payment. The Fee Determination Official's rating for both
interim and final evaluations will be provided to the contractor within
45 calendar days of the end of the period being evaluated. Any fee,
interim or final, due the contractor will be paid no later than 60
calendar days after the end of the period being evaluated.
1816.406-70 [Amended]
7. In paragraph (a) of section 1816.406-70, the last sentence is
removed.
PART 1852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
8. In section 1852.216-76, the clause date is revised, the
designated paragraph (f) is redesignated as paragraph (g) and
republished, a new paragraph (f) is added, and Alternate I to the
clause is removed, to read as follows:
1852.216-76 Award fee for service contracts.
As prescribed in 1816.406-70(a), insert the following clause:
Award Fee for Service Contracts
March 1998
* * * * *
(f)(1)Provisional award fee payments [insert ``will'' or ``will
not'', as applicable] be made under this contract pending the
determination of the amount of fee earned for an evaluation period.
If applicable, provisional award fee payments will be made to the
Contractor on a [insert the frequency of provisional payments (not
more often than monthly)] basis. The total amount of award fee
available in an evaluation period that will be provisionally paid is
the lesser of [Insert a percent not to exceed 80 percent] or the
prior period's evaluation score.
(2) Provisional award fee payments will be superseded by the
final award fee evaluation for that period. If provisional payments
exceed the final evaluation score, the Contractor will either credit
the next payment voucher for the amount of such overpayment or
refund the difference to the Government, as directed by the
Contracting Officer.
(3) If the Contracting Officer determines that the Contractor
will not achieve a level of performance commensurate with the
provisional rate, payment of provisional award fee will be
discontinued or reduced in such amounts as the Contracting Officer
deems appropriate. The Contracting Officer will notify the
Contractor in writing if it is determined that such discontinuance
or reduction is appropriate. This determination is not subject to
the Disputes clause.
(4) Provisional award fee payments [insert ``will'' or ``will
not'', as appropriate] be made prior to the first award fee
determination by the Government.
(g) Award fee determinations made by the Government under this
contract are not subject to the Disputes clause.
*[A period of time greater or lesser than 6 months may be
substituted in accordance with 1816.405-272(a).]
(End of clause)
[FR Doc. 98-7033 Filed 3-17-98; 8:45 am]
BILLING CODE 7510-01-P
