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(2) Contacting the cognizant Regional OFCCP for verification of EEO compliance.

(i) OFCCP may require 30 days lead time for verification if a compliance study is required. This should be considered in the procurement planning process.

(ii) The contracting officer may make initial inquiry to OFCCP by telephone, and telephone verification of EEO compliance may be used in making an award; however, the inquiry and verification must be confirmed in writing.

(iii) The following information is normally required by OFCCP:

(A) The offeror's full name and address;

(B) Name, title, address, and telephone number of a contact person for the prospective contractor;

(C) A description of the type of organization (university, nonprofit, etc.) and its ownership (private, foreign, state, etc.).

(D) Names and addresses of organizations in joint venture (if any); names and addresses of subcontractors (if any).

(E) Type of procurement (new contract-RFP or IFB, amendment, etc.) and estimated dollar amount, and term.

(F) Copy of approved Reps. and Certs. and O/S Team Agreement. In the initial contact with OFCCP, the contracting officer and OFCCP should mutually determine what information is to be included in the written verification request. In the event that OFCCP reports that the offeror is not in compliance, negotiations with the offeror shall be terminated.

(c) Contracts over $10,000, but less than $1,000,000. Contracts and amendments within this range do not require formal verification by OFCCP (see § 712.805-52). The method used to verify compliance is at the discretion of the contracting officer. The contracting officer may rely on the documentation submitted by the offeror (the Reps. and Certs. and O/S Team Agreement-see § 7-12.805-53(a)), unless he or she is aware of some reason to doubt the documentation submitted. In case of doubt, then an informal check with OFCCP should be made. In

the event that evidence of non-compliance is developed, the contracting officer must contact OFCCP for confirmation of EEO status; only OFCCP may determine non-compliance with EEO requirements. If OFCCP confirms non-compliance, negotiations with the offeror contractor shall be terminated.

(d) Documentation for the contract file. (1) Every contract file must contain completed signed Reps. and Certs. and (when applicable) the O/S Team Agreement. The file must clearly show that these documents have been reviewed and accepted by the contracting officer. If the Reps. and Certs. or O/S Team Agreement were revised to make them acceptable (see § 7-12.80553(a)), the file must show what changes were required and certify that the changes were made.

(2) For contracts or amendments of $1,000,000 or more, the file must contain:

(i) A record of the initial contact with OFCCP, specifying the name, address, and telephone number of the person contacted, a summary of the information presented, and the advice given by OFCCP;

(ii) A copy of the written follow-up request for EEO compliance verification to OFCCP; and

(iii) A copy of the compliance verification from OFCCP.

(3) For contracts or amendments over $10,000 but less than $1,000,000, the file must contain a memorandum from the contracting officer stating that the contractor is considered in compliance with EEO requirements, and giving the basis for this statement (see § 7-12.805-53(c)).

(4) Documentation in the event of non-compliance. In the event that OFCCP determines that a prospective contractor is not in compliance, a copy of OFCCP's written determination, and a summary of resultant action taken (termination of negotiations, notification of offeror and project officer, negotiation with next offeror in competitive range, re-solicitation, etc.) will be placed in the contract file for any contract which may result, together with other records related to unsuccessful offers, and retained for at least six months following award.

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§ 7-15.205-6 Compensation for personal services.

(a) General. (1) Specific limitations on compensation for personal services, including fringe benefits, may be spelled out or incorporated by reference in AID contracts. Where the provisions of the contract are inconsistent with this section, such provisions will govern.

(2) Direct compensation of personnel will be reimbursable, in accordance with the contractor's established policies and procedures and FPR 1-15.2056 except as provided in paragraphs (b) through (j) of this section. Such policies, procedures, and practices shall be the same as used in contracts and grants with other Government agencies and accepted by the U.S. Government agency assigned primary audit responsibility for the contractor, shall be in writing, and shall be made available to the contracting officer or his designated representative, upon request.

(3) Overseas recruitment incentive.

(i) Contract employees serving overseas under a contract who do not qualify, request, and receive an exemption for overseas income provided under section 911 of the U.S. Internal Revenue Code (26 U.S.C. 911) are eligible to receive an overseas recruitment incentive, provided that the average incentive for all such employees does not exceed 10 percent of the initial base annual salary of all employees eligible for the incentive under the contract.

(ii) The overseas recruitment incentive is payable under one of the following alternative methods:

33-136 0-84-9

(A) As a lump-sum amount after the eligible employee has completed his tour of duty in the Cooperating Country under a contract, and has furnished to the contractor a Certification that he does not qualify, and will not apply for an exemption from overseas income as provided by 26 U.S.C. 911 (the contractor shall retain such Certifications for post-audit); or

(B) At the option of the contractor, the overseas recruitment incentive may be paid in increments during an employee's tour of duty; provided however, that payments made by the contractor to employees who become eligible for an exemption from overseas income as provided by 26 U.S.C. 911, which payments were reimbursed by AID under the contract, shall be refunded to AID; and provided further, that neither the contractor's (nor the subcontractor's) inability to collect refunds from ineligible employees shall be used as a basis to excuse subsequent refunds by the contractor to AID.

(iii) If the overseas recruitment incentive causes the employee's salary to exceed the FSR-1 level, contracting officer approval must be obtained.

(b) Salaries and wages. (1) Salaries and wages exclude overseas differential and other allowances associated with overseas service but include payments for personal services (including fees and honoraria) computed on a daily rate or other time basis different from an annual rate. Daily rates of compensation are computed on the basis of a 260-day work year made up to 5-day (8 hour) work weeks.

(2) Any compensation (i.e., the employee's or consultant's base annual salary plus overseas recruitment incentive, if any) which exceeds the maximum payable annual or daily rate for a Foreign Service Officer Class FS-1 as set forth in the payment schedule of the Uniform State/AID/USIA Regulations, as from time to time amended, will be reimbursed only with the written approval of the contracting officer. Contracting officer approval of salaries in excess of the maximum payable rate for a Foreign Service Officer Class FS-1 will be based upon a memorandum from the technical office and approved by the assistant

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having program responsibility for the project in support of which the contract is written. The technical office is responsible for evaluating the reasonableness of the proposed salary, taking into account such factors as the degree of technical competence required, the scope of supervisory responsibilities involved, and the relationship of the proposed salary level to the contractor's customary salary level, and other pertinent information. Copies of all memoranda approved by the assistant administrator or mission director will be furnished to the Support Division, Office of Contract Management.

(3) For policies on compensation of third country national or cooperating country national contractor employees, see AIDPR 7-12.101-1.50(b). (c)-(f) [Reserved]

(g) Fringe benefits. AID contracts spell out rules and principles governing reimbursement of specific fringe benefits related to overseas service, including leave, holidays, differential, allowances, travel, transportation, and similar costs. The contract provisions are set forth in Part 7-7.

[39 FR 33517, Sept. 18, 1974, as amended at 41 FR 1914, Jan. 13, 1976; 46 FR 51917, Oct. 23, 1981; 47 FR 13146, Mar. 29, 1982]

§ 7-15.205-46 Travel costs.

§ 7-15.205-46.50 Special restrictions. [30 FR 12981, Oct. 12, 1965] 887-15.205-46.51-7-15.205-46.52

[Reserved]

§ 7-15.205-46.53 International travel.

International travel costs are allowable only when the travel has received the specific prior approval of the contracting officer. For purposes of this provision, international travel is defined as any travel outside of the United States, or its territories and possessions. (See AIDPR 7-7.5002-3.)

[39 FR 38646, Nov. 1, 1974]

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§ 7-15.303-51 Compensation for personal services.

(a) Specific limitations on compensation for personal services are set forth in AIDPR 7-7.5501-5 and 7-7.5502-4. Contracting officer approval of salaries in excess of the maximum payable annual or daily rate for a Foreign Service Officer Class FS-1, as set forth in the Uniform State/AID/USIA Regulations, as from time to time amended will be based upon a memorandum from the technical office and approved by the assistant administrator or mission director having program responsibility for the project in support of which the contract is written. The technical office is responsible for evaluating the reasonableness of the proposed salary, taking into account such factors as the degree of technical competence required, the scope of supervisory responsibilities involved, and the relationship of the proposed salary level to the contractor's customary salary level, and other pertinent information. Copies of all memoranda approved by the assistant administrator or mission director will be furnished to the Support Division, Office of Contract Management.

(b) For policies on compensation of third country national or cooperating country national contractor employees, see AIDPR 7-12.101-1.50(b).

[39 FR 33518, Sept. 18, 1974. Redesignated at 46 FR 31889, June 18, 1981 and amended at 46 FR 51918, Oct. 23, 1981; 47 FR 13146, Mar. 29, 1982]

Subpart 7-15.6-Contracts with Nonprofit Organizations

§ 7-15.603-50 OMB Circular A-122; AID

implementation.

(a) The transmittal letter for OMB Circular A-122 is set forth in FPR 115.603. Paragraph 6 of the transmittal letter specifies that "Agencies shall designate a liaison official to serve as the agency representative on matters relating to the implementation of this Circular." The Director, Office of Contract Management, Bureau for Program and Management Services, has been so designated. The Overhead and Special Cost Branch (SER/CM/SOD/ OSC) in the Office of Contract Management provides staff assistance to the Director concerning OMB Circular A-122. SER/CM/SOD/OSC is also responsible for obtaining cognizance under the criteria in the transmittal letter for OMB Circular A-122; for liaison with other cognizant agencies; for authorizing exclusion of OMB Circular A-122 coverage for a particular nonprofit organization pursuant to paragraph 5 of the OMB Circular A122 transmittal letter; and for advice and assistance in applying OMB Circular A-122 cost principles.

(b) Paragraph 4b of the OMB Circular A-122 transmittal letter contains a definition of "prior approval" as follows:

"Prior approval means securing the awarding agency's permission in advance to incur costs for those items that are designated as requiring prior approval by OMB Circular A-122. Generally, this permission will be in writing. Where an item of cost requiring prior approval is specified in the budget of an award, approval of the budget constitutes approval of that cost."

Consequently, an award containing a budget constitutes prior approval of the direct cost item in the budget, unless otherwise annotated. Accordingly, award budgets should be appropriately annotated substantially as follows:

"Inclusion of any cost in the line item budget of this award does not obviate the requirement for prior approval of cost items

designated as requiring prior approval by OMB Circular A-122;"

or

"In accordance with the requirements of OMB Circular No. A-122, approval is granted to incur costs for (name specific item or items) which are included in the budget of this award."

[46 FR 31890, June 18, 1981]

§ 7-15.603-2.50 Compensation for personal services.

(a) AID is frequently required to report and justify reimbursement of salaries for contractor employees which exceed the maximum payable annual or daily rate for a Foreign Service Officer Class FS-1, as set forth in the Uniform State/AID/USIA Regulations, as from time to time amended. In order to be able to meet this requirement, it is AID policy to require prior approval by the contracting officer before reimbursing a contractor for employee conpensation which exceeds the FS-1 rate, as set forth in the payment schedule of the Uniform State/AID/USIA Regulations. The contracting officers approval will be obtained as specified in AIDPR 715.205-6(b)(2).

(b) For policies on compensation of third country national or cooperating country national contractor employees, see AIDPR 7-12.101-1.50(b).

[46 FR 31890, June 18, 1981, as amended at 46 FR 51918, Oct. 23, 1981; 47 FR 13146, Mar. 29, 1982]

§ 7-15.603-2.51 Bid and proposal costs.

Pending the establishment of Government-wide principles in Attachment B of OMB Circular A-122, AID will treat bid and proposal costs as follows:

costs for allocation to all current activities, and no bid and proposal costs of past accounting periods will be allocable to the current period. However, if the organization's established practice is to treat bid and proposal costs by some other method, the results obtained may be accepted only if found to be reasonable and equitable.

(b) Bid and proposal costs incurred by the organization to obtain unrestricted funds are to be treated as fund raising and allocated an appropriate share of indirect costs under the conditions described in paragraph B.3. of Attachment A to OMB Circular A-122.

[47 FR 37885, Aug. 27, 1982]

§ 7-15.603-2.52 Independent research and development costs.

Pending establishment of Government-wide principles in Attachment B of OMB Circular A-122, AID will apply the cost principles at FPR 115.205-35 (41 CFR 1-15.205-35) for independent research and development costs.

[47 FR 37885, Aug. 27, 1982]

PART 7-16-PROCUREMENT FORMS

Subpart 7-16.5-Forms for Advertised and Negotiated Nonpersonal Services Contracts (Other Than Construction and Architect-Engineer Contracts)

Sec.

7-16.500 Scope of subpart.

7-16.550 Cover Page for Agency for Inter-
national Development Cost Reimburse-
ment Type Contract.

7-16.551-7-16.553 [Reserved]
7-16.554 Cover Page for Contracts for Par-

(a) Bid and proposal costs are the
costs of preparing bids, proposals, and
applications for potential activities
such as Government and non-Govern-
ment grants, contracts and other
agreements, including the develop-
ment of scientific, cost, and other data
needed to support such bids, propos-
als, and applications. Except as provid-
ed in paragraph (b) of this section, bid
and proposal costs of the current ac-
counting period of both successful and
unsuccessful bids and proposals nor- 7-16.800 Scope of subpart.
mally should be treated as indirect 7-16.806

ticipant Training: Individual and Group. 7-16.555 Cover Page for Agency for International Development Fixed Price Technical Services Contract.

7-16.556 Cover Page for Agency for International Development Cost Reimbursement Contract with an Educational Institution.

7-16.557 Negotiated Indirect Cost Rate

Agreement.

Subpart 7-16.8—Miscellaneous Forms

Contract pricing proposals.

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