[Federal Register Volume 85, Number 151 (Wednesday, August 5, 2020)]
[Notices]
[Pages 47358-47359]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-17100]


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DEPARTMENT OF COMMERCE


Notice of Indirect Cost Rates for the Damage Assessment, 
Remediation, and Restoration Program for Fiscal Year 2018

AGENCY: National Oceanic and Atmospheric Administration (NOAA), 
Commerce

ACTION: Notice of Indirect Cost Rates for the Damage Assessment, 
Remediation, and Restoration Program for Fiscal Year 2018.

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SUMMARY: The National Oceanic and Atmospheric Administration's (NOAA's) 
Damage Assessment, Remediation, and Restoration Program (DARRP) is 
announcing new indirect cost rates on the recovery of indirect costs 
for its component organizations involved in natural resource damage 
assessment and restoration activities for fiscal year (FY) 2018. The 
indirect cost rates for this fiscal year and date of implementation are 
provided in this notice. More information on these rates and the DARRP 
policy can be found at the DARRP website at www.darrp.noaa.gov.

FOR FURTHER INFORMATION: For further information, contact LaTonya 
Burgess by phone at 240-533-0428 or email at [email protected].

SUPPLEMENTARY INFORMATION: The mission of the DARRP is to restore 
natural resource injuries caused by releases of hazardous substances or 
oil under the Comprehensive Environmental Response, Compensation, and 
Liability Act (CERCLA) (42 U.S.C. 9601 et seq.) and the Oil Pollution 
Act of 1990 (OPA) (33 U.S.C. 2701 et seq.), and to support restoration 
of physical injuries to National Marine Sanctuary resources under the 
National Marine Sanctuaries Act (NMSA) (16 U.S.C. 1431 et seq.). The 
DARRP consists of three component organizations: The Office of Response 
and Restoration (ORR) within the National Ocean Service; the 
Restoration Center within the National Marine Fisheries Service; and 
the Office of the General Counsel Natural Resources Section (GCNRS). 
The DARRP conducts Natural Resource Damage Assessments (NRDAs) as a 
basis for recovering damages from responsible parties, and uses the 
funds recovered to restore injured natural resources.
    Consistent with federal accounting requirements, the DARRP is 
required to account for and report the full costs of its programs and 
activities. Further, the DARRP is authorized by law to recover 
reasonable costs of damage assessment and restoration activities under 
CERCLA, OPA, and the NMSA. Within the constraints of these legal 
provisions and their regulatory applications, the DARRP has the 
discretion to develop indirect cost rates for its component 
organizations and formulate policies on the recovery of indirect cost 
rates subject to its requirements.

The DARRP's Indirect Cost Effort

    In December 1998, the DARRP hired the public accounting firm Rubino 
& McGeehin, Chartered (R&M) to: evaluate the DARRP cost accounting 
system and allocation practices; recommend the appropriate indirect 
cost allocation methodology; and determine the indirect cost rates for 
the three organizations that comprise the DARRP. A Federal Register 
notice on R&M's effort, their assessment of the DARRP's cost accounting 
system and practice, and their determination regarding the most 
appropriate indirect cost methodology and rates for FYs 1993 through 
1999 was published on December 7, 2000 (65 FR 76611).
    R&M continued its assessment of DARRP's indirect cost rate system 
and structure for FYs 2000 and 2001. A second federal notice specifying 
the DARRP indirect rates for FYs 2000 and 2001 was published on 
December 2, 2002 (67 FR 71537).
    In October 2002, DARRP hired the accounting firm of Cotton and 
Company LLP (Cotton) to review and certify DARRP costs incurred on 
cases for purposes of cost recovery and to develop indirect rates for 
FY 2002 and subsequent years. As in the prior years, Cotton concluded 
that the cost accounting system and allocation practices of the DARRP 
component organizations are consistent with federal accounting 
requirements. Consistent with R&M's previous analyses, Cotton also 
determined that the most appropriate indirect allocation method 
continues to be the Direct Labor Cost

[[Page 47359]]

Base for all three DARRP component organizations. The Direct Labor Cost 
Base is computed by allocating total indirect cost over the sum of 
direct labor dollars, plus the application of NOAA's leave surcharge 
and benefits rates to direct labor. Direct labor costs for contractors 
from ERT, Inc. (ERT), Freestone Environmental Services, Inc. 
(Freestone), and Genwest Systems, Inc. (Genwest) were included in the 
direct labor base because Cotton determined that these costs have the 
same relationship to the indirect cost pool as NOAA direct labor costs. 
ERT, Freestone, and Genwest provided on-site support to the DARRP in 
the areas of injury assessment, natural resource economics, restoration 
planning and implementation, and policy analysis. Subsequent federal 
notices have been published in the Federal Register as follows:

 FY 2002, published on October 6, 2003 (68 FR 57672)
 FY 2003, published on May 20, 2005 (70 FR 29280)
 FY 2004, published on March 16, 2006 (71 Fed Reg. 13356)
 FY 2005, published on February 9, 2007 (72 FR 6221)
 FY 2006, published on June 3, 2008 (73 FR 31679)
 FY 2007 and FY 2008, published on November 16, 2009 (74 FR 
58948)
 FY 2009 and FY 2010, published on October 20, 2011 (76 FR 
65182)
 FY 2011, published on September 17, 2012 (77 FR 57074)
 FY 2012, published on August 29, 2013 (78 FR 53425)
 FY 2013, published on October 14, 2014 (79 FR 61617)
 FY 2014, published on December 17, 2015 (80 FR 78718)
 FY 2015, published on August 22, 2016 (81 FR 56580)

    Empirical Concepts developed the DARRP indirect rates for FY 2016 
and 2017. Empirical reaffirmed that the Direct Labor Cost Base is the 
most appropriate indirect allocation method for the development of the 
FY 2016 and 2017 indirect cost rates. The federal notice for these 
rates can be found at the following:

 FY 2016 and FY 2017, published on October 16, 2019 (84 FR 
55283)

    Empirical Concepts developed the DARRP indirect rates for FY 18 and 
reaffirmed the Direct Labor Cost Base as the most appropriate indirect 
allocation for the development of the FY 2018 indirect cost rates.

The DARRP's Indirect Cost Rates and Policies

    The DARRP will apply the indirect cost rates for FY 2018 as 
recommended by Empirical for each of the DARRP component organizations 
as provided in the following table:

------------------------------------------------------------------------
                                                              FY 2018
              DARRP  component organization                indirect rate
                                                                (%)
------------------------------------------------------------------------
Office of Response and Restoration (ORR)................          148.84
Restoration Center (RC).................................           71.94
General Counsel Natural Resources Section (GCNRS).......           79.21
------------------------------------------------------------------------

    The FY 2018 rates will be applied to all damage assessment and 
restoration case costs incurred between October 1, 2017 and September 
30, 2018 effective October 1, 2020. DARRP will use the FY 2018 indirect 
cost rates for future fiscal years, beginning with FY 2019, until 
subsequent year-specific rates can be developed.
    For cases that have settled and for cost claims paid prior to the 
effective date of the fiscal year in question, the DARRP will not re-
open any resolved matters for the purpose of applying the revised rates 
in this policy for these fiscal years. For cases not settled and cost 
claims not paid prior to the effective date of the fiscal year in 
question, costs will be recalculated using the revised rates in this 
policy for these fiscal years. Where a responsible party has agreed to 
pay costs using previous year's indirect rates, but has not yet made 
the payment because the settlement documents are not finalized, the 
costs will not be recalculated.

Scott Lundgren,
Director, Office of Response and Restoration, National Ocean Service, 
National Oceanic and Atmospheric Administration.
[FR Doc. 2020-17100 Filed 8-4-20; 8:45 am]
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