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KR_2016

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Posts posted by KR_2016

  1. Good afternoon everyone,

    I have a couple questions concerning FAR 52.232-22 Limitation of Funds that I was hoping someone could answer.

    1. Does the LOF clause apply to each CLIN on a contract? In other words, if I have a  contract containing a CPFF CLIN for Labor and a COST only  CLIN for Travel,  would I have to give separate notifications for each CLIN once 75% of the current funding is expended? Or is it based on the overall cumulative funded amount of both CLINS (Labor & Travel), in which case I would then give notice when 75% of the combined funding is expended.
    2. Is FAR 52.232-22 cost specific, or does it include incremental fixed fee funding as well? Section (b) of the LOF FAR states the following:

                      " (b) The Schedule specifies the amount presently available for payment by the Government and allotted to this contract, the items covered, the Government’s share of the cost if this is a cost-sharing contract, and the period of performance it is estimated the allotted amount will cover. The parties contemplate that the Government will allot additional funds incrementally to the contract up to the full estimated cost to the Government specified in the Schedule, exclusive of any fee. The Contractor agrees to perform, or have performed, work on the contract up to the point at which the total amount paid and payable by the Government under the contract approximates but does not exceed the total amount actually allotted by the Government to the contract."

    Given this provision of the FAR I am assuming the LOF notification should be based on  incremental COST funding only, and would exclude incremental Fixed Fee Funding, and would apply both to CPFF contracts and CPIF Cost Sharing Contracts .

    If anyone can provide any insight it would be much appreciated. Thank you.

  2. 17 hours ago, C Culham said:

    Without your compete contract it might be difficult for anyone to answer your questions.  Here is why....

    1. What does the contract's "Schedule" say with regard to ceiling? :

    The funding was all under one CLIN. The funding information shown under that CLIN States: (Note: I removed the funded and POP info):

    MAXIMUM HOURS AND COST

    The Total amount to be paid to the contractor under this contact from (showed Period of Performance)  shall not exceed (Showed total Funded amount).

    Contract Performance

    Labor Rate Breakdown For Item 0001

    Labor Category   Hours      Rate            Total

    Sr. Software Eng      656   Pay Rate     Funded amt   

    Program Manager      18     Pay Rate   Funded amt.            

    Total                          674                      Total funds

    KR_2016 Note: We worked a total of 419 hours, well under the total 674 hours allotted. The problem is The PM exceeded his allotted hours by 20 and the SSE worked 225 hours less than that his allotted amount.  

    2. Does the contract speak in any other section to what will occur if the maximum is exceeded for a labor category? 

    The language used in the contract seems to be solely concerned with not exceeding the ceiling price. The contract contains NAVAIR Clause 5252.232-9507 Limitation of Funds - Time & Material and Labor Hour Contracts, which basically states the Gov't is not obligated to reimburse the contractor for costs incurred in excess of the total amount allotted by the Gov't without modification and approval by the CO. I copy and pasted  the NAVAIR Clause  and Bolded/Underlined areas of concern and inserted a notes and a question on key points.

    5252.232-9507 LIMITATION OF FUNDS - TIME AND MATERIAL AND LABOR-HOUR CONTRACTS

    (NAVAIR) (OCT 2005)

    (a) The parties estimate that performance of this contract will not cost the Government more than the ceiling

    price specified in the Schedule or on the individual Task Order. The contractor agrees to use its best effort to

    perform the work specified in the Schedule or Task Orders, and all obligations under this contract, within the

    ceiling price.

    (b) The Schedule or individual Task Orders specify the amounts presently available for payment by the

    Government and allotted to the contract or individual Task Orders, the items covered, and the period of

    performance it is estimated the allotted amounts will cover. The parties contemplate that the Government will

    allot additional funds incrementally to the contract or individual Task Orders up to the full ceiling price. The

    contractor agrees to perform, or have performed, work on the contract up to the point at which the total amount

    paid and payable by the Government under the contract and individual Task Orders approximates, but does not

    exceed, the total amount actually allotted by the Government to the contract.

    KR_2016 Note: This language seems to indicate the clause is concerned with the total overall amount allotted.

    (c) The contractor shall notify the Contracting Officer in writing whenever it has reason to believe that the costs

    it expects to incur under the contract or an individual Task Order in the next sixty (60) days, when added to all

    costs previously incurred, will exceed seventy-five (75%) percent of the total amount so far allotted to the contract

    or Task Order by the Government. The notice shall state the estimated amount of additional funds required to

    continue performance for the period specified in the Schedule or Task Order.

    (d) Sixty (60) days before the end of the period specified in the Schedule or individual Task Order, the

    contractor shall notify the Contracting Officer in writing of the estimated amount of additional funds, if any,

    required to continue timely performance under the contract or for any further period specified in the Schedule or

    Task Order, or otherwise agreed upon, and when the funds will be required.

    (e) If, after notification, additional funds are not allotted by the end of the period specified in the Schedule or

    individual Task Order, or another agreed upon date, upon the contractor's written request the Contracting Officer

    will terminate the contract or individual Task Order on that date, in accordance with the provisions of the

    Termination clause of this contract. If the contractor estimates that the funds available will allow it to continued to

    discharge its obligations beyond that date, it may specify a later date in its request, and the Contracting Officer

    may terminate the contract or individual Task Order on that later date.

    (f) Except as required by other provisions of this contract, specifically citing and stated to be an exception of this

    clause -

    (1) The Government is not obligated to reimburse the contractor for costs incurred in excess of the total

    amount allotted by the Government to this contract; and

    KR_2016 Question: Is the total amount allotted the overall ceiling amount of hours/funding, or is it specific to the total amounts allotted to the individual labor categories?

    (2) The contractor is not obligated to continue performance under this contract or individual Task Orders

    (including actions under the Termination clause of this contract), or otherwise incur costs in excess of the amount

    then allotted to the contract or Task Order by the Government, until a modification is executed increasing the

    amount allotted by the Government to the contract or Task Order.

    (g) The ceiling price shall be increased in accordance with the provisions of FAR clause 52.232-7, "Payments

    Under Time-and-Materials and Labor-Hour Contracts".

    (h) No notice, communication, or representation in any form other than specified in subparagraph (f)(2) above,

    or from any person other than the Contracting Officer, shall affect the amount allotted by the government to this

    contract or an individual Task Order. In the absence of the specified notice, the Government is not obligated to

    reimburse the contractor for any costs in excess of the total amount allotted by the Government to this contract,

    whether incurred during the course of the contract or as a result of termination.

    (i) When and to the extent the amount allotted by the Government to the contract or an individual Task Order is

    increased, any costs the contractor incurs before the increase that are in excess of the amount previously allotted by

    the Government shall be allowable to the same extent as if incurred afterward, unless the Contracting Officer

    issues a termination or other notice and directs that the increase is solely to cover termination or other specified

    expenses.

    (j) Change orders shall not be considered an authorization to exceed the amount allotted by the Government

    specified in the Schedule or individual Task Order, unless they contain a statement increasing the amount allotted.

    (k) Nothing in this clause shall affect the right of the Government to terminate this contract or an individual

    Task Order.

    3.  Confirm that 52.232-7 is in fact the clause in the contract  If for example it is 52.212-4 is instead the then the action regarding potential overpayment is explicit.

    Yes, FAR 52.232-7 is contained within the reference clauses. 52.212-4 is not in the contract.

    4. Most importantly have you discussed this matter with the CO for the contract?

    This is an older contract and the CO is no longer available. My next step was to contact our ACO for direction, but I wanted to gather some opinions from WIFCON members first. I don't want to sound like a fool when talking to the ACO. :rolleyes:

     

    Hello C. Culham,

    Thank you for the reply, I've attempted to answer your questions above. My answers are in bold.

     

    V/r,

    KR_2016

     

  3. Hi NJRobe,

    Just wanted to clarify, the Final invoice was within the funding limitation requirement set forth in the their subcontract per FAR 52.232-22 . We did not bill the Gov't for anything exceeding that funding limitation. The greater issue concerns the timeliness in which subcontracts should be closed, and I think here_2_help's advice on that issue is very helpful.

     

    V/r,

    KR_2016 

  4. Hello Wifcon Forum Members,

    I've recently began reviewing a physically completed T&M/LH for closeout purposes. This particular T&M/LH contract has the following specifications under the heading "Maximum Hours and Cost" for the following two labor categories:

    1. Sr. Software Engineer  - 656 hours at $/hour
    2. Program Manager -  18 Hours at $/hour

    A review of the contract invoices shows the following amount of Labor Hours billed/charged during the course of the contract:

    1. Sr. Software Engineer - 381 hours
    2. Program Manager -  38 hours

    As you can see, the SSE was well under the allotted hours and the PM was slightly over. My main questions concerning this situation are :

    1. Given that the PM charged more than the 18 allotted hours, would our company need to issue a refund of the 20 hours paid in excess of the PM allotted hours?
    2. Would the fact that we were well under the total amount of allotted hours (SSE & PM allotted total hours) and came in well under the funded amount (DE obligated the excess funding) to finish the job make any difference?
    3. I read through FAR 52.232-7 - Payments under Time and Materials and Labor Hour Contracts, specifically the section concerning "Hourly Rates" and more specifically part 3 (see bold below). Would hour allotments fit into the "labor qualification" mentioned below in part 3?

    "(a) Hourly rate.

    (1) Hourly rate means the rate(s) prescribed in the contract for payment for labor that meets the labor category qualifications of a labor category specified in the contract that are—

    (2) The amounts shall be computed by multiplying the appropriate hourly rates prescribed in the Schedule by the number of direct labor hours performed.

    (3) The hourly rates shall be paid for all labor performed on the contract that meets the labor qualifications specified in the contract. Labor hours incurred to perform tasks for which labor qualifications were specified in the contract will not be paid to the extent the work is performed by employees that do not meet the qualifications specified in the contract, unless specifically authorized by the Contracting Officer.

    (4) The hourly rates shall include wages, indirect costs, general and administrative expense, and profit. Fractional parts of an hour shall be payable on a prorated basis.

    (5) Vouchers may be submitted not more than once every two weeks, to the Contracting Officer or authorized representative. A small business concern may receive more frequent payments than every two weeks. The Contractor shall substantiate vouchers (including any subcontractor hours reimbursed at the hourly rate in the schedule) by evidence of actual payment and by—

    (6) Promptly after receipt of each substantiated voucher, the Government shall, except as otherwise provided in this contract, and subject to the terms of paragraph (e) of this clause, pay the voucher as approved by the Contracting Officer or authorized representative.

    (7) Unless otherwise prescribed in the Schedule, the Contracting Officer may unilaterally issue a contract modification requiring the Contractor to withhold amounts from its billings until a reserve is set aside in an amount that the Contracting Officer considers necessary to protect the Government’s interests. The Contracting Officer may require a withhold of 5 percent of the amounts due under paragraph (a), but the total amount withheld for the contract shall not exceed $50,000. The amounts withheld shall be retained until the Contractor executes and delivers the release required by paragraph (g) of this clause.

    (8) Unless the Schedule prescribes otherwise, the hourly rates in the Schedule shall not be varied by virtue of the Contractor having performed work on an overtime basis. If no overtime rates are provided in the Schedule and overtime work is approved in advance by the Contracting Officer, overtime rates shall be negotiated. Failure to agree upon these overtime rates shall be treated as a dispute under the Disputes clause of this contract. If the Schedule provides rates for overtime, the premium portion of those rates will be reimbursable only to the extent the overtime is approved by the Contracting Officer.

    • (i) Performed by the Contractor;

      (ii) Performed by the Subcontractors; or

      (iii) Transferred between divisions, subsidiaries, or affiliated of the Contractor under a common control.

      (i) Individual daily job timekeeping records;

      (ii) Records that verify the employees meet the qualifications for the labor categories specified in the contract; or

      (iii) Other substantiation approved by the Contracting Officer."

     

    Any guidance/advice would be appreciated.  

     

    V/r,

    KR_2016

     

     

     

     

     

     

     

  5. 5 minutes ago, here_2_help said:

    1. Yes.

    2. Yes.

    3.  If the billed subcontractor costs show up on the 2016 ICA then I assume I'll have to wait until 2016 ICA audit is complete to close out the Prime Contract, correct? There is no way around that I suppose. Yes, there is. You can close out your subcontract at any time based on your negotiation with the subcontractor and agreement of the final rates to be billed. Neither your company nor the subcontractor need government approval to reach agreement on rates to be used to close-out the subcontract.

    Thank you for the information, here_2_help. I  appreciate you taking the time to answer my question.

    V/r,

    KR_2016  

  6. Hello here_2 _help,

    Would that be:

    1.  Yes, I can bill the 2016 final subcontractor invoice even though the 2014 prime contract ended.  

    2. Yes, the billed costs will show up on 2016's ICA.

    If the billed subcontractor costs show up on the 2016 ICA then I assume I'll have to wait until 2016 ICA audit is complete to close out the Prime Contract, correct? There is no way around that I suppose.

     

    Thank you

     

  7. Hello Wifcon members,

    I have a situation that I hope one of you can help me with. A subcontractor that worked under one of our Prime Contracts recently sent me their final invoice this month (Sept 2016), their final invoice was a rate adjustment based on their DCAA approved final indirect rates. The Prime Contract they worked under ended in 2014, but still has funding remaining on it. My questions are:

    1.  Can I bill their Final Rate Adjustment Invoice against the remaining funding left on the prime contract even though the prime contract has already ended?
    2.  Our prime contract costs for FY 2014 (year the prime contract was physically completed/ended) are currently being audited by the DCAA, would billing out the final invoice in FY2016 cause that cost to show up on the 2016 DCAA ICA? Is there a way to bill this Rate Adjustment Final Invoice without interfering with the DCAA's ICA?

    I'm somewhat new to this whole process and appreciate any guidance.

    V/R,

    KR_2016

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