[Federal Register Volume 86, Number 161 (Tuesday, August 24, 2021)]
[Notices]
[Pages 47300-47301]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-18113]


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DEPARTMENT OF COMMERCE

National Oceanic and Atmospheric Administration


Notice of Indirect Cost Rates

AGENCY: Office of Response and Restoration (OR&R), National Ocean 
Service (NOS), National Oceanic and Atmospheric Administration (NOAA), 
U.S. Department of Commerce (DOC).

ACTION: Notice of indirect cost rates for the Damage Assessment, 
Remediation, and Restoration Program for Fiscal Year 2019.

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SUMMARY: Notice is hereby given to announce 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) 2019. The indirect cost rates for this fiscal year and 
date of implementation are provided in this notice. More information on 
these rates and the Damage Assessment, Remediation, and Restoration 
Program (``DARRP'') policy can be found at the DARRP website at 
www.darrp.noaa.gov.

FOR FURTHER INFORMATION CONTACT: For further information contact: 
LaTonya Burgess at (240) 533-0428, [email protected]

SUPPLEMENTARY INFORMATION:

Background

    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 Fiscal Years 
(``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 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-

[[Page 47301]]

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 FR 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, 2017, and 2018 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)
 FY 2018, published on August 5, 2020 (85 FR 47358)

    Empirical Concepts developed the DARRP indirect rates for FY 19 and 
reaffirmed the Direct Labor Cost Base as the most appropriate indirect 
allocation for the development of the FY 2019 indirect cost rates.

The DARRP's Indirect Cost Rates and Policies

    The DARRP will apply the indirect cost rates for FY 2019 as 
recommended by Empirical for each of the DARRP component organizations 
as provided in the following table:

------------------------------------------------------------------------
                                                              FY 2019
              DARRP component organization                 indirect rate
                                                             (percent)
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Office of Response and Restoration (ORR)................          142.15
Restoration Center (RC).................................           76.99
General Counsel Natural Resources Section (GCNRS).......           65.95
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    The FY 2019 rates will be applied to all damage assessment and 
restoration case costs incurred between October 1, 2018 and September 
30, 2019 effective October 1, 2021. DARRP will use the FY 2019 indirect 
cost rates for future fiscal years, beginning with FY 2020, 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. 2021-18113 Filed 8-23-21; 8:45 am]
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