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wmcastleberry

Lodging Per Diem - No Receipts

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I have a question that I would think should be easy to answer.  However, I have found that many of the parties involved are not too sure of what to do. 

The problem is that the contractor has acquired lodging expenses for several weeks, but only has receipts for one week.  The CO is claiming that according to the Joint Travel Regulations, maybe nothing is owed to the contractor, except what they have receipts for.  However, my research makes me believe that although we may not be entitled to the full per diem amount of $129 per day for the full amount of time, we may be entitled to at least $75 per expense, since we do not have receipts (according to GSA 301-11.25).

FAR 31.205-46 is incorporated into the contract.  Have any of you ever run across this problem?  Thanks!

 

 

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1 hour ago, wmcastleberry said:

The problem is that the contractor has acquired lodging expenses for several weeks, but only has receipts for one week. 

Are you telling us that the contractor cannot get a copy of a lodging payment record from the hotel? It cannot get a credit card record showing the payment of the lodging expense? Really? In the modern world?

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2 hours ago, wmcastleberry said:

However, my research makes me believe that although we may not be entitled to the full per diem amount of $129 per day for the full amount of time, we may be entitled to at least $75 per expense, since we do not have receipts (according to GSA 301-11.25).

Who is the "we" in the sentence quoted above? Is your question about per diem (lodging + M&IE) or about lodging?

What is the contractor's standard practice with respect to reimbursing employees for lodging expense? Does that standard practice comply with 31.205-46? Is this just a one-off anomaly, or is this how the contractor intends to operate going forward?

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So many things left unsaid!

First is your post related in any way to this discussion thread?   http://www.wifcon.com/discussion/index.php?/topic/3819-travel-costs-mie-per-diem-vs-actuals/

If not related then missing is information about the prime contract under which the travel expenses were “acquired”.  What type of contract is it?   What is the actual contract language that references FAR 31.205-46? 

Even absent the above I do not think you have read FTR Chap, 31, paragraph 11.25 closely.  It provides a further reference of “see §301-52.4 of this chapter” which provides as follows –

“§301-52.4  What must I provide with my travel claim?

You must provide:

(a) Evidence of your necessary travel authorizations including any necessary special authorizations;

(b) Receipts for:

(1) Any lodging expense;

(2) Any other expense costing over $75. If it is impracticable to furnish receipts in any instance as required by this subtitle, the failure to do so must be fully explained on the travel voucher. Mere inconvenience in the matter of taking receipts will not be considered; and

(3) Receipts must be retained for 6 years and 3 months as prescribed by the National Archives and Records Administration (NARA) under General Records Schedule 6, paragraph number 1 (http://www.archives.gov/records-mgmt/ardor/grs06.html).”

 

Noting this additional FTR language additional detail would be needed regarding the detail of expenses – hotel actual receipt and documentation of “other expenses” with regard to evaluating the “at least $75” that might be paid without furnishing receipts.

 

Bottom line I do not think your question can be or should be answered in this forum as it is specific to the contract under which the travel expenses (with or without receipt) were experienced.   Any question about what is allowed travel expenses, again with or without receipts, should be answered by the contractor (prime?) and the CO for the contract. 

 

On this basis I am OUT!

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19 hours ago, wmcastleberry said:

The problem is that the contractor has acquired lodging expenses for several weeks, but only has receipts for one week.  The CO is claiming that according to the Joint Travel Regulations, maybe nothing is owed to the contractor, except what they have receipts for. 

I agree with Carl that the solution to the stated problem depends on the terms of the contract, but there is something more.

The question, as asked, reflects a fundamental misunderstanding of the contractual standing of the government's travel regulations in determining the allowability of travel costs. Those regulations apply only to the determination of the reasonableness of the costs incurred for lodging, meals, and incidental travel expenses, unless the contract expressly provides otherwise. As referenced in FAR 31.205-46, they do not impose any documentation or record keeping requirements on the contractor. The only mention of the travel regulations in FAR 31.205-46 is in subparagraph (a)(2), as follows:

Quote

(2) Except as provided in paragraph (a)(3) of this subsection, costs incurred for lodging, meals, and incidental expenses (as defined in the regulations cited in (a)(2)(i) through (iii) of this paragraph) shall be considered to be reasonable and allowable only to the extent that they do not exceed on a daily basis the maximum per diem rates in effect at the time of travel as set forth in the

(i) Federal Travel Regulations, prescribed by the General Services Administration, for travel in the contiguous United States...

(ii) Joint Travel Regulation, Volume 2, DoD Civilian Personnel, Appendix A, prescribed by the Department of Defense, for travel in Alaska, Hawaii, and outlying areas of the United States...

(iii) Standardized Regulations (Government Civilians, Foreign Areas), Section 925, “Maximum Travel Per Diem Allowances for Foreign Areas,” prescribed by the Department of State, for travel in areas not covered in (a)(2)(i) and (ii) of this paragraph....

The requirement for receipts is in 31.205-46(a)(3), and it applies only in "special or unusual situations," when the contractor wants reimbursement of costs in excess of the maximums stated in the travel regulations. FAR 31.205-46(a)(3)(iv) states that in such cases:

Quote

For such higher amounts to be allowable, all of the following conditions must be met... (iv) Documentation to support actual costs incurred shall be in accordance with the contractor’s established practices, subject to paragraph (a)(7) of this subsection, and provided that a receipt is required for each expenditure of $75.00 or more. The approved justification required by paragraph (a)(3)(ii) and, if applicable, paragraph (a)(3)(iii) of this subsection must be retained.

Thus, a contractor that wants reimbursement of travel costs of in excess of the maximums in the applicable travel regulation must have receipts for amounts of $75.00 or more. Otherwise, the cost principle does not mention or require receipts.

The cost principle does not contractually impose the JTR or FTR requirements for receipts. See e.g., JTR 2710, Receipt Requirements. Unless the contract otherwise specifies something more, I see no requirement for contemporaneous receipts or for specific receipt content, so I  see no reason why proof of payment cannot be obtained after the fact in support of a request for reimbursement. As I'm sure H2H would say, the contractor should have a documented policy about such matters and adhere to it.

 

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Thank you for the responses.  Vern, that really helps to clear things up.  I agree, there should be records of payment to support reimbursement, but unfortunately there are not.  Thanks again for the useful information.

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Wm, also note that the JTR, which is a DoD publication does not apply to travel within the lower 48 states.  Rather, the FTR published by GSA applies to travel there.  Also, not all portions of either regulations are made applicable to contractors by the cost principle.  Finally, under the cost principle, contractors are free to have a policy that they will reimburse travelers at the maximum per diem rate, which includes lodging, meals and incidental expenses.  This eliminates the need for any documentation to justify any actual expenses.  Therefore, there are two questions that seem relevant here:  what does the contract say concerning travel costs and what is the contractor's policy in regard to reimbursement of travel costs?

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This post is in no way intended to dispute any post to this thread but rather provide further exploration of the situation, as noted in the OP’s question and found in other threads of WIFCON, where FAR 31.205-46 is incorporated into a contract.

FAR 31.000 Scope of part provides -

“This part contains cost principles and procedures for—

(a) The pricing of contracts, subcontracts, and modifications to contracts and subcontracts whenever cost analysis is performed (see 15.404-1(c)); and

(b) The determination, negotiation, or allowance of costs when required by a contract clause.” (emphasis added)

 

FAR 31.103 goes on to say (hopefully paraphrased appropriately) that for certain contracts that are negotiated on the basis of cost that ”the cost principles and procedures in Subpart 31.2  and agency supplements” SHALL (emphasis added) be incorporated into the certain contracts by reference and used for the basis of –

31.103(b)(1) –“ Determining reimbursable costs under—

(i) Cost-reimbursement contracts and cost-reimbursement subcontracts under these contracts performed by commercial organizations and

(ii) The cost-reimbursement portion of time-and-materials contracts except when material is priced on a basis other than at cost (see 16.601(c)(3));

(2) Negotiating indirect cost rates (see Subpart 42.7);

(3) Proposing, negotiating, or determining costs under terminated contracts (see 49.103 and 49.113);

(4) Price revision of fixed-price incentive contracts (see 16.204 and 16.403);

(5) Price redetermination of price redetermination contracts (see 16.205 and 16.206); and

(6) Pricing changes and other contract modifications.”

 

 

Thinking about the above it would seem that rather than simply stating a specific reference like FAR 31.205-46 the contract should reference the whole of FAR 31.2.  Doing so would help as the FAR must be read in whole and solely referencing say FAR 31.205-46 leaves a gap with regard to such thoughts as “what is the contractor's policy in regard to reimbursement of travel costs?”.

Further a real dilemma occurs if the contract was negotiated on the basis of “price” (as defined by FAR Part 15) as the question is raised per a full read of FAR 31 if a contract is negotiated on the basis of “price” should there even be reference to FAR 31.2 principles and procedures is in the contract?

Noting that FAR Part 31 has no prescribed clauses CO’s are left to jury rigging references to Subpart 31.2 leaving wide holes when just a specific reference like FAR 31.205-46 is placed in a contract.  Cherry picking a reference like FAR 31.205-46 for incorporation into the contract just does not cut it the whole of FAR 31.2 needs to be referenced.

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3 minutes ago, C Culham said:

Noting that FAR Part 31 has no prescribed clauses CO’s are left to jury rigging references to Subpart 31.2 leaving wide holes when just a specific reference like FAR 31.205-46 is placed in a contract.  Cherry picking a reference like FAR 31.205-46 for incorporation into the contract just does not cut it the whole of FAR 31.2 needs to be referenced.

Right on. That's why the inclusion of 52.216-7 (Allowable Cost & Payment) is so critical.

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Carl, and H2H, you have made good general points.  However, it is not uncommon for a fixed price contract to have a travel CLIN that states that the contractor will be reimbursed for travel costs that are allowable pursuant to FAR 31.205-46.  Further, it is not uncommon for such contracts to state that no indirect costs or fee/profit shall be allocated to the contract because of the travel costs.  Clearly in these situations not all of FAR 31.2 would be applicable to the contract because we are only talking about a specific cost.

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Retreadfed,

I'm unclear how a contract with a reimbursable CLIN can be a fixed-price contract. Where can I find that contract described in Subpart 16.2? Wouldn't it be a hybrid contract at best? Where does that contract get reported on the DCAA ICE Model, Schedule H?

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A fixed-price contract with a separate cost-reimbursement CLIN would be a combination of types (not a "hybrid"). See FAR 16.102(b). Appropriate cost-reimbursement clauses should be included in the contract as applicable to the cost-reimbursement CLIN, e.g., FAR 52.216-7.

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1 hour ago, Retreadfed said:

However, it is not uncommon for a fixed price contract to have a travel CLIN that states that the contractor will be reimbursed for travel costs that are allowable pursuant to FAR 31.205-46.  Further, it is not uncommon for such contracts to state that no indirect costs or fee/profit shall be allocated to the contract because of the travel costs.  Clearly in these situations not all of FAR 31.2 would be applicable to the contract because we are only talking about a specific cost.

If you have a cost-reimbursement CLIN, then you must include FAR 52.216-7, which effectively incorporates all of FAR Subpart 31.2 into the contract. If the parties agree that indirect costs will not be reimbursable, or that certain cost principles will not be applicable, then the parties must include a contract clause (advance agreement -- see FAR 31.109) to that effect. You still need FAR Subpart 31.2, if only to establish the distinction between direct and indirect costs, and you need to make sure that if the advance agreement is a FAR deviation you obtain the required approval.

I know that not everyone goes to such lengths, but that is beside the point. I am old school and was taught the right way to do things.

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Could be biased but many times "old school" has been proven effective over time and is why it is the way to go!

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The use of cost-reimbursement travel CLINs is common in fixed-price contracts. If the FAR councils were thoughtful and proactive they'd develop an exclusive and special clause for such CLINs and make it clear to all that the use of such a CLIN does not make a contract a combination of types and does not require incorporation of other cost-reimbursement clauses. The special clause would include all appropriate terms, including the appropriate provisions of FAR 31.205-46, and include a limitation of cost or funds provision. But the FAR councils are not thoughtful and proactive, so we have what we have.

Maybe one of the young hotshots out there will draft such a clause and submit it to the councils for consideration.

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24 minutes ago, Vern Edwards said:

... you need to make sure that if the advance agreement is a FAR deviation you obtain the required approval.

I'm not necessarily sure that an agreement to make unallowable by contract term an otherwise allowable and allocable cost requires a deviation, but I absolutely agree it requires a special contract clause. Otherwise, the customer should expect to pay the contractor its direct and indirect costs calculated via the contractor's standard methods.

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I don't think that an advance agreement to make an otherwise allowable cost unallowable would necessarily constitute a FAR deviation, although I suppose that one might argue to the contrary. However, it the parties were to so agree, they would have to comply with FAR 31.201-6.

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