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Showing results for tags 'FAR 52.215-23'.



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Found 3 results

  1. Scenario: A competitive-bid solicitation for a FFP general construction Navy contract in GA under any of the various socio-economic categories. This solicitation includes FAR clauses 52.215-22 and 52.215-23: Limitations on Pass-Through Charges, with the obvious intention of applicability to any change orders. Whereas these clauses are not intended for FFP contracts “awarded based on adequate competition” per 15.408(n)(2)(i)( B )(1)(i), the contracting officer responded to a solicitation question by quoting 15.408(n)(2)(ii) that states “The clause may be used when the total estimated contract or order value is below the thresholds identified in 15.408(n)(2)(i) and for any contract type, when the contracting officer determines that inclusion of the clause is appropriate.” (emphasis added). Forgetting for the moment that this acquisition is NOT below the threshold for obtaining cost and pricing data (and thus 15.408(n)(2)(ii) should not apply), as a general contractor managing a very multi-discipline project with multiple working subcontractors, there is hardly a modification that I can contemplate that a subcontractor, lower-tier subcontractor, or some combination thereof, is not performing at least 70% of the cost of the work. So I guess my question is: Do I have any reason to be concerned that these clauses are included given that 52.215-23(a) specifically excludes “charges for the cost of managing subcontracts and any applicable indirect costs and associated profit/fee based on such cost” from the definition of “Excessive pass-through charge”?
  2. Help! I am a prime contractor working on a (competitively bid, edwosb set-aside) FFP Air Force construction project in NW Florida. I am processing a change order and the government contracting officer is indicating that I will not be able to add overhead and profit markups on my subcontractor’s markups. I AM permitted to account for my additional labor, materials, and supervision hours (with markups), and normal OH and profit markup to the subcontractor’s direct cost, but NO OH or profit markup on the portion of my total subcontractor’s price that result from his OH and profit markup. These costs are a part of my subcontractor’s price and are my “direct cost” (as I read FAR 43.203( b )(2)). Further, there is no place on the AF Form 3052 to segregate these costs as subcontractor costs would be added as a direct cost in column 9. The subcontractor effort will probably be less than 70% of the change, but this isn’t relevant since FAR clauses 52.215-22 or 52.215-23 “Limitations on Pass-Through Charges” are NOT included in the contract and, as I understand them, are intended for cost reimbursable type contracts anyway. The contract does include standard limitations on subcontracting that apply to the total value of the contract (labor, as this is a construction project), not to a specific change order. Can anyone give me a definitive source that I can reference for this Contracting Officer confirming that a prime contractor’s overhead (and profit) markup on subcontracted efforts (based on total subcontract price) is allowable? Of course, I am willing to negotiate in good faith if they return the same. If it helps, like most small business, CAS is not applicable and we do not have separate G&A and Overhead pools, only one comprehensive overhead rate. Thanks
  3. Help! I am a prime contractor working on a (competitively bid, edwosb set-aside) FFP Air Force construction project in NW Florida. I am processing a change order and the government contracting officer is indicating that I will not be able to add overhead and profit markups on my subcontractor’s markups. I AM permitted to account for my additional labor, materials, and supervision hours (with markups), and normal OH and profit markup to the subcontractor’s direct cost, but NO OH or profit markup on the portion of my total subcontractor’s price that result from his OH and profit markup. These costs are a part of my subcontractor’s price and are my “direct cost” (as I read FAR 43.203( b )(2)). Further, there is no place on the AF Form 3052 to segregate these costs as subcontractor costs would be added as a direct cost in column 9. The subcontractor effort will probably be less than 70% of the change, but this isn’t relevant since FAR clauses 52.215-22 or 52.215-23 “Limitations on Pass-Through Charges” are NOT included in the contract and, as I understand them, are intended for cost reimbursable type contracts anyway. The contract does include standard limitations on subcontracting that apply to the total value of the contract (labor, as this is a construction project), not to a specific change order. Can anyone give me a definitive source that I can reference for this Contracting Officer confirming that a prime contractor’s overhead (and profit) markup on subcontracted efforts (based on total subcontract price) is allowable? Of course, I am willing to negotiate in good faith if they return the same. If it helps, like most small business, CAS is not applicable and we do not have separate G&A and Overhead pools, only one comprehensive overhead rate. Thanks
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