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Couple of teammates and I have been batting around the topic of contractor parking and whether or not it is an allowable cost.  The original solicitation stated that the place of performance was a primary duty location.  It was silent on parking.  The Government has a lease at the location and as part of the lease, received parking passes.  The parking passes were doled out to Government employees and contractor employees.  It is a access restricted parking lot.  The Government is intending on increasing its workforce at the location and will be revoking the contractor's allotment of parking passes. The contractor is now required to buy parking passes for its employees.  Under a cost-reimbursable contract, is this an allowable cost?

Parking is not called out as an allowable cost in the FAR.  It was not addressed as part of "local travel" in the solicitation either.

 

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A cost does not have to be "called out" as allowable or explicitly mentioned in a solicitation or contract in order to be allowable.

According to FAR 31.201-2, "Determining allowability," a cost incurred by a contractor under a contract with the Government and a commercial organization must pass five tests in order to be allowable":

1. it must be reasonable in nature and amount;

2. it must be directly or indirectly allocable (chargeable) to the contract;

3. the cost must be allocated to the contract in compliance with any applicable cost accounting standards;

4. the cost must be compliant with any applicable terms of the contract; and

5. the cost must be in compliance with any limitations set forth in FAR Subpart 31.5.

It seems to me that if (a) the contract specifies the place of performance, and (b) the contractor's employees must travel to that location and then must park their cars, and [c] the contractor provides parking passes to its employees as part of their compensation, then the only questions are (1) whether such employee compensation is reasonable in nature and amount and (2) whether the parking cost is properly allocable as a direct or indirect cost.

Have I given you enough information to enable you to make your own determination?

 

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This gets contentious only because the Government Employee having to approve the cost is having to pay for thier own parking while the contract employee is being reimbursed for parking in a $18 a day lot under the building.  Is the price reasonable?   Well, all the garages in the area charge $18 a day for regular parking, some more. However, there is the early bird parking for arriving before 8AM that only costs $8.  Then there is the lot 4 blocks away that the Government employee parks in that only costs $5 but he has to walk 4 blocks.  The contractor chooses to arrive at 8:30AM and cause the Government to pay and extra $10.   So what is really a reasonable price?  So Mr. Fed is upset that he is paying and walking 4 blocks while the guy at the next desk can park in the building any time he wants and be reimbursed. 

The contract should have said we would not allow parking costs but then the contractor could just increase salary to reimburse without a separate charge for parking.  Thus, what is one to do?  Comparative compensation between Feds and contractors is always an issue, so much so that our contracts for danger zones contain line items for Danger Pay and Post Differential even though the contractor could compensate any way  that gets personnel to go there. Problem is the higher paid contract hires see the FEDS getting the extra pay and threaten to leave country if they don't get it too.  So you have the contractor pay them the same salary as the FEDS and then pay them the same extra pay.  Problem solved.   

No,  I am not the disgruntled FED.  I have a parking pass.  When my staff gripe, I tell them they should consider becoming a contract hire with its uncertainty.    

 

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Boof,

 

In your first post you said the government provided parking passes for government employees (and, at one time, contractor personnel also). In your third post you said the government employees have to pay for their own parking.

So which is it? I don't see how it can be both.

H2H

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I don't know who's question the thread concerns but I agree with Vern.  In addition, if the government thinks that it is reasonable to pay for government employee parking at the duty site, why is it unreasonable to pay for contract employees' parking when you direct that they report to the same site?

As a gov't employee, I had to pay for my own parking space at one District Office assignment.  At other PCS assignments, the government provided parking.  At most TDY downtown teaching assignments, I have to pay for parking and am reimbursed for parking expenses.  If the government, which is historically a miser with respect to its employee TDY's, will pay for my parking, why not pay for contract staff parking?

If the government wasn't paying anyone for parking at the site in the first post to this thread, it might be different...

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During the Carter administration I worked on an Air Force base in a suburb of Los Angeles. There was plenty of free parking. Then President Carter decided that civil servants and military personnel shouldn't get special treatment and that we were all going to have to pay $5 a day to park on the base. Everyone was angry about it, but there was no public transportation to speak of in L.A. and some people were commuting as much as 100 miles each way to work, so you had to have some kind of ground transportation, which meant you had to have a place to park. You could not park on the thoroughfares around the base, so people started parking in nearby residential neighborhoods, which generated a lot of complaints to the mayor and the 3-star in command. I don't remember how long it lasted, weeks or months, but Jimmy C. eventually had to back off. We all voted for Reagan in 1980. Ronnie won in a walk. Revenge is sweet.

Today there is no longer enough parking on that base for all who work there and, despite what they say, there is still no public transportation in L.A. that's worth talking about. Many have to pay to park in a contractor's lot. I'm pretty sure it's more than $5 per day.

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1 hour ago, Retreadfed said:

H2H , note that the OP is nfm2012, not boof.

My bad

 

ETA: When I worked in public accounting we all had to pay for parking. I think it was $30 or $50 a month or something like that. We shared the parking structure with a number of other businesses, including a very expensive gym. Some of the staff found out that the gym validated parking for its members, or for anybody who bought anything in the gym's store or restaurant. All of a sudden everybody was going to the gym first thing in the morning--not to work out, but to buy a cup of coffee. Buy a cup, get a validation for your day's parking.

That went on for years. It may still be going on for all I know. From then on, when somebody went out for a cup of coffee, the trip was commonly referred to as "going to staff parking."

Edited by here_2_help
I thought of a funny story to add

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Thank you for the feedback.  In our situation, all government employees are receiving parking passes.  Its a part of the lease agreement with GSA.

I'm a relative newbie when it comes to working for the government and managing cost-type contracts.  It seems to me that there is a lot the government will pay for under a cost-type contract (according to the classes I've taken), but somehow "parking" can be a sticking point..

 

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It all goes back to Vern's original point: is it reasonable considering the circumstances, and is it 100% allocable to a contract?  

Bottom line,  contractors may or may not reimburse their employees for parking, at their discretion, with the attendant risks of disgruntled employees feeling like they are being taken advantage of.  There is no CLIN for 'parking' on any contract I've ever seen, so it's a business decision whether to take it out of overhead. 

The only time I could ever see parking not be deemed 'reasonable' is if someone was using pay parking when free parking was otherwise available, i.e., "never".

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REA'n Maker,

On a cost-type contract, the existence (or lack of) a CLIN does not determine whether or not a cost is a direct contract cost. See FAR definition of direct cost at 2.101, which states that a direct cost is "any cost that is identified specifically with a particular final cost objective." (Emphasis added.)

 

H2H

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