Delete ASPR 7-204.16. 7-402.3 Allowable Cost, Fee, and Payment. (a) Except as provided in (b) below, the clause in 7-203.4(a) shall be inserted in all cost-reimbursement type research and development contracts. Additional instructions for use are in (c) below. (b) When, pursuant to 3-405.4, incentive revision of the fee in a cost-reimbursement type research and development contract is to be provided, the clause in 7-203.4(b) shall be included in the contract. Additional instructions for use of the clause are in (c) below. (c) In the clauses prescribed in (a) and (b) above, the following changes shall be made. (1) For approvals with regard to fixed-price type subcontracts providing for progress payments, pursuant to paragraph (c) of the clauses, the standards shall be the same as those governing progress payments on fixed-price type prime contracts, as provided by E-514 of Appendix E. (2) In subparagraph +f[ (1)] (ii)(B) the period of years may be increased to correspond with any statutory period of limitation applicable to claims of third parties against the contractor; provided, that a corresponding increase is made in the period for retention of records required in paragraph (a)(4) of the clause prescribed by 7-402.7. (3) In respect to paragraph (c) of the clause prescribed in (b) above, generally the payment of fee provisions in the Schedule should be based on target fee. (4) Under some circumstances the use of a sliding scale may be ap propriate in paragraph (1)(0)] of the clause prescribed in (b) above (for example, $0.01 for the first $100, $0.02 for the next $100, etc.), in which case necessary changes in the wording of such paragraph (i) [(0)] of the clause prescribed in (b) above are authorized. (5) In the case of contracts, including cost-sharing contracts, without fee: (ii) insert the following sentence in lieu of the second sentence of para- After payment of an amount equal to eighty percent (80%) of (the Government's share of) the total estimated cost of performance of this contract set forth in the Schedule, the Contracting Of ficer may withhold further payment on account of allowable cost until a reserve shall have been set aside in an amount which he considers necessary to protect the interests of the Government, but such reserve shall not exceed one percent (1%) of (the Government's share of such total estimated cost or one hundred thousand dollars ($100,000), whichever is less. (1968 SEP) (iii) delete "and any part of the fixed fee" from paragraph te✈[(k)] of the clause prescribed in (a) above. (iv) change paragraph (a) of the clause prescribed in (a) above, as fol lows: (a) The allowability of costs incurred in the performance of this contract shall be determined by the Contracting Officer in accordance with: (i) Part 2 of Section XV of the Armed Services Procurement Regulation in effect on the (ii) the terms of this contract. (6) In contracts without fee with nonprofit institutions, “ten thousand dollars ($10,000)" may be substituted for "one hundred thousand dollars ($100,000)" in the sentence set forth in (5)(ii) above. (7) In contracts with educational institutions substitute Part 3 of Section XV in paragraph (a)(i)(A) of the clause prescribed in (a) above and in paragraph (a)(i)(A) of the clause prescribed in (b) above. (8) In contracts without fee with educational institutions, the second sentence of paragraph (c) of the clause prescribed in (a) above and the provision of subparagraph (5)(ii) of these additional instructions, which pertain to withholding of fee and costs, may be omitted. If the second sentence of paragraph (c) is so omitted, in the first sentence of paragraph (e) delete “and any part of the fixed fee which has been withheld pursuant to (c) above or otherwise." (9) In the clauses prescribed above, “Task Order" or other appropriate designation may be substituted for “Schedule." (ID) In the clause prescribed in (b) above, “provisioning document or" may be deleted from paragraph [(9)] thereof if inappropriate to the procurement. (11) When clause paragraph (c) provides for withholding, the amount to be withheld shall normally be the maximum authorized by the clause except that the administrative contracting officer may, if he believes that such amount exceeds the amount necessary to protect the interests of the Government, review the status of all funds being withheld from the contractor under the particular contract concerned and under any other contracts with the contractor which he is administering and make appropriate recommendations to the PCO. The PCO shall decide whether to reduce the rate of withholding or whether to release a portion of the amount already reserved under the contract, as appropriate, and shall promptly advise the administrative contracting officer. 96-305 O 77-10 NEGOTIATED OVERHEAD RATES-PREDETERMINED (1970 SEP) (a) Notwithstanding the provisions of the clause of this contract entitled "Allowable Cost and Payment", the allowable indirect costs under this contract shall be obtained by applying predetermined overhead rates to bases agreed upon by the parties, as specified below. (b) The Contractor, as soon as possible but not later than three (3) months after the expiration of his fiscal year shall submit to the Contracting Officer with a copy to the cognizant audit activity, a proposed predetermined overhead rate or rates based on the Contractor's actual cost experience during that fiscal year, together with supporting cost data. Negotiation of predetermined overhead rates by the Contractor and the Contracting Officer shall be undertaken as promptly as practicable after receipt of the Contractor's proposal. (c) Allowability of costs and acceptability of cost allocation methods shall be determined in accordance with the Armed Services Procurement Regulation, Section XV, Part 3, as in effect on the date of this contract. (d) Predetermined rate agreements in effect on the effective date of this contract shall be incorporated into the contract schedule. Rates for subsequent periods shall be negotiated and the results set forth in a written overhead rate agreement executed by both parties. Such agreement shall be automatically incorporated into this contract upon execution and shall specify (i) the agreed predetermined overhead rates, (ii) the bases to which the rates apply, (iii) the fiscal year unless the parties agree to a different period for which the rates apply, and (iv) the specific items treated as direct costs or any changes in the items previously agreed to be direct costs. The overhead rate agreement shall not change any monetary ceiling, contract obligation, or specific cost allowance or disallowance provided for in this contract. (e) Pending establishment of predetermined overhead rates for any fiscal year or different period agreed to by the parties, the Contractor shall be reimbursed either at the rates fixed for the previous fiscal year or other period or at billing rates acceptable to the Contracting Officer subject to appropriate adjustment when the final rates for that fiscal year or other period are established. (f) Any failure by the parties to agree on any predetermined overhead rate or rates under this clause shall not be considered a dispute concerning a question of fact for decision by the Contracting Officer within the meaning of the "Disputes" clause of this contract. If for any fiscal year or other period specified in the Schedule of this contract the parties fail to agree to a predetermined overhead rate or rates it is agreed that the allowable indirect costs under this contract shall be obtained by applying negotiated final overhead rates in accordance with the terms of the "Negotiated Overhead-Rates Postdetermined" clause-set forth-in-3-7042 ["Allowable Cost, Fee, and Payment" clause set forth in 7-203.4] of the Armed Services Procurement Regulation as in effect on the date of this contract. (g) Allowable indirect costs for the period until the end of the Contractor's fiscal year during which performance begins shall be obtained by applying the predetermined overhead rate set forth in the Schedule to the bases set forth therein. (End of clause) 7-605.5 Allowable Cost, Fixed Fee, and Payment. Insert the clause in 7-203.4(a) with the following changes: (a) Delete paragraph (a) and substitute the following: (a) For the performance of this contract, the Government shall pay to the Contractor: (i) The cost thereof (hereinafter referred to as "allowable cost") determined by the Contracting Officer to be allowable in accordance with (A) Section XV, Part 4, of the Armed Services Procurement Regulation as in effect on the date of this contract [, provided that the allowable indirect costs under this contract shall be obtained by applying overhead rates established under (e) below to bases agreed upon under (f) below]; and (B) The terms of this contract; and (ii) a fixed fee in the amount of (b) Delete paragraph (c) and substitute the following: (c) Promptly after receipt of each invoice or voucher and statement of cost, the Government shall, except as otherwise provided in this contract, subject to the provisions of (d) below, make payment thereon as approved by the Contracting Officer. Payment of the fixed fee, if any, shall be made to the Contractor in installments based upon the percentage of completion of the work as determined from estimates submitted to and approved by the Contracting Officer, provided, however, that after payment of eighty-five percent (85%) of the fixed fee set forth in (a) above, the Contracting Officer may withhold further payment of fee until a reserve shall have been set aside in an amount which he considers necessary to protect the interests of the Government, but such reserve shall not exceed fifteen percent (15%) of the total fixed fee or one hundred thousand dollars ($100,000), whichever is less. (1970 SEP) (c) The additional instructions for use of the clause as set forth in 7-203.4(c)(1), (2), (6) and (7) apply. (Section XX) Part 9--Corporate Administrative Contracting Officer (CACO) 20-901 Scope. This Part sets forth (1) policy and procedures for the assignment of a single Corporate Administrative Contracting Officer (CACO) to deal with corporate management for selected multi-division contractors and (11) duties and responsibilities of the assigned CACO, including his relationship to other contracting officers, particularly those within other contract administration organizations. 20-902 Policy. Many contractors with more than one operational location (divisions, plants, subsidiaries, etc.) have corporate-wide policies, procedures, and activities requiring Government review or approval which may be more efficiently performed by a single administrative contracting officer who has been delegated appropriate authority. To promote effectiveness and consistency in the performance of contract administration service functions, a CACO may be esignated and given responsibility for performing functions as provided herein. 20-903 Assignment. A CACO should be established for only those contractors with at least two operational locations where resident ACO's are assigned. For the purpose of this paragraph, a non-resident ACO will be considered the equivalent of a resident ACO if at least 75% of the ACO's effort is devoted to a single contractor. CACO functions will be performed by either a designated resident ACO or a full-time CACO who should be in residence at either the corporate headquarters office or at one of the major plant locations. Other inportant considerations for determining the location of the CACO should include the geographic locations of the corporate office and the Contract Audit Coordinator (CAC). If a particular corporate complex does not meet the criteria for |