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Proposed change to FAR


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Question: How, if at all possible, can contractors propose changes to FAR? Does anyone know what the process is? Any help or direction for me to look in would be greatly appreciated. I just want to take a nap when researching this.

Backstory:

We hold contracts with the federal government that are subject to Wage Determinations. This last year the minimum wage was increased over $10.00 / hour!! So of course we put in for an increase in our price. Well according to FAR 52.222-43 (e) "Any adjustment will be limited to increases or decreases in wages and fringe benefits as described in paragraph (d) of this clause, and the accompanying increases or decreases in social security and unemployment taxes and workers’ compensation insurance but shall not otherwise include any amount for general and administrative costs, overhead, or profit."

This does not allow for our General Liability Insurance increase we will have to pay. Do they count General Liability as an administrative cost? Our General Liability is directly related to our cost of payroll (8.078% per $1,000 of Payroll associated with this contract).

Our CO wouldn't allow FUTA to be added on there since it's a flat rate x $7,000.00. We tried arguing that we will have employees that leave before they make that much etc but he didn't care. It's a minimal amount so we dropped it. 

It also doesn't include Oregon Paid Leave...so far the CO hasn't kicked that back out. But we aren't holding our breath that he will let it be included in our increase.

This has been a nightmare and very stressful to say the least.

Thank you for any ideas and input!

 

Chris

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Chris,

Before you propose a new FAR Case, I think you have to be very specific about what you want to see changed. It is not clear to me from your post exactly what your concerns are.

As to General Liability insurance, that is a cost accounting matter, in my view, and not a contract clause issue. 

Hope this helps.

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@ChrisR, are you saying that none of these costs you wish to recover are classified as general an administrative costs or overhead in your company's cost accounting system and that each is classified in your company's cost accounting system as wages and fringe benefits as described in paragraph (d), of the clause, and/or the accompanying increases or decreases in social security and unemployment taxes and workers’ compensation insurance?

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