[Federal Register Volume 59, Number 203 (Friday, October 21, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-26164]


[[Page Unknown]]

[Federal Register: October 21, 1994]


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DEPARTMENT OF DEFENSE

48 CFR Parts 216, 242, and 252

 

Defense Federal Acquisition Regulation Supplement; Predetermined 
Indirect Cost Rates

AGENCY: Department of Defense (DoD).

ACTION: Final rule.

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SUMMARY: The Department of Defense is revising the Defense FAR 
Supplement to implement revisions to OMB Circular A-21 (58 FR 39996) 
that permit predetermined indirect cost rates for educational 
institutions to be applicable for a period of up to four years.

EFFECTIVE DATE: October 18, 1994.

FOR FURTHER INFORMATION CONTACT:
Mrs. Linda W. Neilson, (703) 604-5929.

SUPPLEMENTARY INFORMATION: 

A. Background

    On July 26, 1993, the Office of Management and Budget published 
revisions to OMB Circular A-21 (58 FR 39996) which include an increase 
in the period of time for which predetermined indirect cost rates for 
educational institutions may be applicable. Pending revision of the 
Federal Acquisition Regulation to conform the language to the revised 
OMB Circular, the Defense FAR Supplement is amended to permit use of 
predetermined indirect cost rates for educational institutions for 
periods of up to four years.
    The Director, Defense Procurement, issued this final DFARS rule by 
Departmental Letter 94-018, October 18, 1994, to expedite DoD 
implementation of this revision.

B. Regulatory Flexibility Act

    DoD certifies that this rule will not have a significant economic 
impact on a substantial number of small entities within the meaning of 
the Regulatory Flexibility Act because the rule merely implements OMB 
Circular A-21 as it relates to predetermined indirect cost rates for 
educational institutions.

C. Paperwork Reduction Act

    The Paperwork Reduction Act does not apply because this final rule 
does not impose any new recordkeeping, information collection 
requirements, or collection of information from offerors, contractors, 
or members of the public which require the approval of OMB under 44 
U.S.C. 3501, et seq.

List of Subjects in 48 CFR Parts 216, 242, and 252

    Government procurement.
Claudia L. Naugle,
Deputy Director, Defense Acquisition Regulations Council.

    Therefore, 48 CFR parts 216, 242 and 252 are amended as follows:

PARTS 216, 242, and 252--[AMENDED]

    1. The authority for Parts 216, 242, and 252 continues to read as 
follows:

    Authority:  41 U.S.C. 421 and 48 CFR Chapter 1.

    2. Section 216.307 is added to read as follows:


216.307  Contract clauses.

    (i) Use the clause at FAR 52.216-15, Predetermined Indirect Cost 
Rates, with 252.216-7002, Alternate A, in solicitations and contracts 
when a cost-reimbursement research and development contract with an 
educational institution (see FAR 42.705-3(b)) is contemplated and 
predetermined indirect cost rates are to be used.
    3. Section 242.705-3, Educational institutions is added to read as 
follows:


242.705-3  Educational institutions.

    (b) Predetermined final indirect cost rates.
    (4)(i) Predetermined indirect cost rate proposals may cover a 
period of two to four years when the cognizant Contracting Officer 
determines that the educational institution's cost experience and other 
pertinent facts available are sufficient to enable the parties to reach 
an informed judgment on the probable levels of indirect costs and 
allocation base costs for the applicable future accounting periods. 
Predetermined rates covering two to four year periods are expected to 
be the norm in those situations.
    (6) Predetermined indirect cost rates may be established to cover 
up to four years.
    4. Section 252.216-7002 is added to read as follows:

252.216-7002  Alternate.

Alternate A (Oct 1994)

    As prescribed in 216.307(i), substitute the following paragraphs 
(b) and (g) for paragraphs (b) and (g) of the clause at FAR 52.216-15, 
Predetermined Indirect Cost Rates:

    (b) Not later than 90 days after the expiration of the 
Contractor's fiscal year (or other period specified in the 
Schedule), the Contractor shall submit to the cognizant Contracting 
Officer under subpart 42.7 of the Federal Acquisition Regulation 
(FAR) and, if required by agency procedures, to the cognizant 
Government audit activity, proposed predetermined indirect cost 
rates and supporting cost data. The proposed rate shall be based on 
the Contractor's actual cost experience during that fiscal year (or 
other period specified in the Schedule). Negotiations of 
predetermined indirect cost rates shall begin as soon as practical 
after receipt of the contractor's proposal.
    (g) Allowable indirect costs for the period from the beginning 
of performance until the end of the Contractor's fiscal year (or 
other period specified in the Schedule) shall be obtained using the 
predetermined indirect cost rates and the bases shown in the 
Schedule.

[FR Doc. 94-26164 Filed 10-20-94; 8:45 am]
BILLING CODE 5000-04-M