NASA Implementation of Earned Value Management (EVM), 66120-66122 [E6-18918]

Download as PDF 66120 Federal Register / Vol. 71, No. 218 / Monday, November 13, 2006 / Rules and Regulations Review, dated September 30, 1993. This interim rule is not a major rule under 5 U.S.C. 804. 48 CFR Parts 1834, 1842, and 1852 RIN 2700–AD29 NASA Implementation of Earned Value Management (EVM) National Aeronautics and Space Administration. ACTION: Interim rule. AGENCY: SUMMARY: This interim rule revises the NASA FAR Supplement (NFS) to implement the Federal Acquisition Regulation (FAR) EVM coverage issued in Federal Acquisition Circular (FAC) 2005–11. DATES: Effective date: This interim rule is effective November 13, 2006. Comment date: Interested parties should submit comments to NASA at the address below on or before January 12, 2007 to be considered in formulation of the final rule. ADDRESSES: Interested parties may submit comments, identified by RIN number 2700–AD29, via the Federal eRulemaking Portal: https:// www.regulations.gov. Follow the instructions for submitting comments. Comments may also be submitted to Ken Sateriale, NASA Headquarters, Office of Procurement, Contract Management Division, Washington, DC 20546. Comments may also be submitted by e-mail to ken.sateriale@nasa.gov. Ken Sateriale, NASA, Office of Procurement, Contract Management Division (Suite 5K86); (202) 358–0491; e-mail: ken.sateriale@nasa.gov. FOR FURTHER INFORMATION CONTACT: Subpart 1834.2—Earned Value Management System B. Regulatory Flexibility Act NATIONAL AERONAUTICS AND SPACE ADMINISTRATION (a) Application of an Earned Value Management System (EVMS) is required for all acquisitions for development designated as major in accordance with OMB Circular A–11, and for development or production contracts and subcontracts, including those for flight and ground support requirements, and institutional requirements (facility, IT investment, etc.) as follows: (i) For contracts and subcontracts valued at $20M or more, and contracts and subcontracts for major acquisitions valued at less than $20M, the EVMS shall comply with the guidelines in the ANSI/EIA–748 Standard. (ii) For contracts and subcontracts valued at $50M or more, the contractor shall have an EVMS that has been formally validated and accepted by the Government. (iii) For contracts and subcontracts for other than major acquisitions valued at less than $20M, earned value management application is optional and is a risk-based decision that is at the discretion of the program/project manager. (iv) EVM is not required on contracts for non-developmental engineering support services, steady state operations, basic and applied research, and routine services such as janitorial services or grounds maintenance services. In these cases, application of EVM is at the discretion of the program/ project manager. (e) Contracting officers shall request the assistance of the cognizant Defense Contract Management Agency (DCMA) office in determining the adequacy of proposed EVMS plans. NASA certifies that this interim rule will not have a significant economic impact on a substantial number of small entities within the meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., because it merely implements the FAR EVM coverage and does not impose an economic impact beyond that addressed in the FAC 2005–11 publication of the FAR final rule. C. Paperwork Reduction Act The Paperwork Reduction Act (Pub. L. 104–13) is not applicable because the NFS changes do not impose information collection requirements that require the approval of the Office of Management and Budget under 44 U.S.C. 3501, et seq. D. Determination To Issue an Interim Rule In accordance with 41 U.S.C. 418(d), NASA has determined that urgent and compelling reasons exist to promulgate this interim rule without prior opportunity for public comment. This action is necessary to harmonize the NFS EVM coverage with that in the FAR which was effective on July 5, 2006. However, pursuant to Pub. L. 98–577 and FAR 1.501, NASA will consider public comments received in response to this interim rule in the formation of the final rule. List of Subjects in 48 CFR Parts 1834, 1842, and 1852 cprice-sewell on PROD1PC66 with RULES SUPPLEMENTARY INFORMATION: Government procurement. A. Background FAC 2005–11 established the requirement for EVM to be implemented on major acquisitions as defined in OMB Circular A–11. The FAR permits agencies to develop provisions and clauses for their own use as long as they are substantially the same as those provided in the FAR. Accordingly, NASA has developed its own provision and clause, and supplemental guidance for EVM implementation. In addition to requiring the application of EVM to major acquisitions as described in OMB Circular A–11, NASA’s coverage provides contract value dollar thresholds for EVM implementation. This is not a significant regulatory action and, therefore, was not subject to review under Section 6(b) of Executive Order 12866, Regulatory Planning and VerDate Aug<31>2005 15:06 Nov 09, 2006 Jkt 211001 Tom Luedtke, Assistant Administrator for Procurement. Accordingly, 48 CFR Chapter XVIII is amended as follows: I CHAPTER XVIII—[AMENDED] 1. Part 1834 is added to subchapter F to read as follows: I PART 1834—MAJOR SYSTEM ACQUISITION Subpart 1834.2—Earned Value Management System Sec. 1834.201 Policy. 1834.203 Solicitation provisions and contract clause. 1834.203–70 NASA solicitation provision and contract clause. Authority: 42 U.S.C. 2473(c)(1). PO 00000 Frm 00028 Fmt 4700 Sfmt 4700 1834.201 Policy. 1834.203 Solicitation provisions and contract clause. The FAR EVMS solicitation provisions and contract clause are not used in NASA contracts. See 1834.203– 70 for the NASA EVMS solicitation provision and contract clause. 1834.203–70 NASA solicitation provision and contract clause. Except for the contracts identified in 1834.201(a)(iv), the contracting officer shall insert— (a) The provision at 1852.234–1, Notice of Earned Value Management System, in solicitations for contracts for— (1) Development or production, including flight and ground support projects, and institutional projects (facility, IT investment, etc.), with a value exceeding $20M; and E:\FR\FM\13NOR1.SGM 13NOR1 Federal Register / Vol. 71, No. 218 / Monday, November 13, 2006 / Rules and Regulations (2) Acquisitions of any value designated as major by the project manager in accordance with OMB Circular A–11; and (b) The clause at 1852.234–2, Earned Value Management System, in solicitations and contracts with a value exceeding $50M that include the provision at 1852.234–1. The contracting officer shall use the clause with its Alternate I when the contract value is less than $50M. PART 1842—CONTRACT ADMINISTRATION AND AUDIT SERVICES 2. The authority citation for 48 CFR part 1842 continues to read as follows: I Authority: 42 U.S.C. 2473(c)(1). Subpart 1842.74—[Removed] 3. Part 1842 is amended by removing Subpart 1842.74. I PART 1852—SOLICITATION PROVISIONS AND CONTRACT CLAUSES 4. The authority citation for 48 CFR part 1852 continues to read as follows: I Authority: 42 U.S.C. 2473(c)(1). 5. Sections 1852.234–1 and 1852.234– 2 are added to read as follows: I 1852.234–1 Notice of Earned Value Management System. cprice-sewell on PROD1PC66 with RULES As prescribed in 1834.203–70(a), insert the following provision: Notice of Earned Value Management System (NOV 2006) (a) The offeror shall provide documentation that its proposed Earned Value Management System (EVMS) complies with the EVMS guidelines in the American National Standards Institute (ANSI)/ Electronic Industries Alliance (EIA)–748 Standard, Earned Value Management Systems. (b) If the offeror proposes to use a system that currently does not meet the requirements of paragraph (a) of this provision, the offeror shall submit its comprehensive plan for compliance with the EVMS guidelines to the Government for approval. (1) The plan shall— (i) Describe the EVMS the offeror intends to use in performance of the contract; (ii) Distinguish between the offeror’s existing management system and modifications proposed to meet the EVMS guidelines in ANSI/EIA–748; (iii) Describe the management system and its application in terms of the EVMS guidelines; (iv) Describe the proposed procedure for application of the EVMS requirements to subcontractors; (v) Describe how the offeror will ensure EVMS compliance for each subcontractor VerDate Aug<31>2005 15:06 Nov 09, 2006 Jkt 211001 subject to the flowdown requirement in paragraph (c) whose EVMS has not been recognized by the Cognizant Federal Agency as compliant according to paragraph (a); (vi) Provide documentation describing the process and results, including Government participation, of any third-party or selfevaluation of the system’s compliance with the EVMS guidelines; and (vii) If the value of the offeror’s proposal, including options, is $50 million or more, provide a schedule of events leading up to formal validation and Government acceptance of the Contractor’s EVMS. This schedule should include progress assistance visits, the first visit occurring no later than 30 days after contract award, and a compliance review as soon as practicable. The Department of Defense Earned Value Management Implementation Guide (https:// acc.dau.mil/ CommunityBrowser.aspx?id=19557) outlines the requirements for conducting a progress assistance visit and validation compliance review. (2) The offeror shall provide information and assistance as required by the Contracting Officer to support review of the plan. (3) The Government will review the offeror’s EVMS implementation plan prior to contract award. (c) The offeror shall identify in its offer the major subcontractors, or major subcontracted effort if major subcontractors have not been selected, planned for application of the EVMS requirement. Prior to contract award, the offeror and NASA shall agree on the subcontractors, or subcontracted effort, subject to the EVMS requirement. (d) The offeror shall incorporate its compliance evaluation factors for subcontractors into the plan required by paragraph (b) of this provision. (End of provision) 1852.234–2 System. Earned Value Management As prescribed in 1834.203–70(b) insert the following clause: Earned Value Management System (NOV 2006) (a) In the performance of this contract, the Contractor shall use— (1) An Earned Value Management System (EVMS) that has been determined by the Cognizant Federal Agency to be compliant with the EVMS guidelines specified in the American National Standards Institute (ANSI)/Electronic Industries Alliance (EIA)— 748 Standard, Industry Guidelines for Earned Value Management Systems (current version at the time of award) to manage this contract; and (2) Earned Value Management procedures that provide for generation of timely, accurate, reliable, and traceable information for the Contract Performance Report (CPR) required by the contract. (b) If, at the time of award, the Contractor’s EVMS has not been determined by the Cognizant Federal Agency to be compliant with the EVMS guidelines, or the Contractor does not have an existing cost/schedule control system that is compliant with the PO 00000 Frm 00029 Fmt 4700 Sfmt 4700 66121 guidelines in the ANSI/EIA–748 Standard (current version at the time of award), the Contractor shall apply the system to the contract and shall take timely action to implement its plan to obtain compliance/ validation. The Contractor shall follow and implement the approved compliance/ validation plan in a timely fashion. The Government will conduct a Compliance Review to assess the contactor’s compliance with its plan, and if the Contractor does not follow the approved implementation schedule or correct all resulting system deficiencies identified as a result of the compliance review within a reasonable time, the Contracting Officer may take remedial action, that may include, but is not limited to, a reduction in fee. (c) The Government will conduct Integrated Baseline Reviews (IBRs). Such reviews shall be scheduled and conducted as early as practicable, and if a pre-award IBR has not been conducted, a post-award IBR should be conducted within 180 calendar days after contract award, or the exercise of significant contract options, or within 60 calendar days after distribution of a supplemental agreement that implements a significant funding realignment or effects a significant change in contractual requirements (e.g., incorporation of major modifications). The objective of IBRs is for the Government and the Contractor to jointly assess the Contractor’s baseline to be used for performance measurement to ensure complete coverage of the statement of work, logical scheduling of the work activities, adequate resourcing, and identification of inherent risks. (d) Unless a waiver is granted by the Cognizant Federal Agency, Contractor proposed EVMS changes require approval of the Cognizant Federal Agency prior to implementation. The Cognizant Federal Agency shall advise the Contractor of the acceptability of such changes within 30 calendar days after receipt of the notice of proposed changes from the Contractor. If the advance approval requirements are waived by the Cognizant Federal Agency, the Contractor shall disclose EVMS changes to the Cognizant Federal Agency at least 14 calendar days prior to the effective date of implementation. (e) The Contractor agrees to provide access to all pertinent records and data requested by the Contracting Officer or a duly authorized representative. Access is to permit Government surveillance to ensure that the Contractor’s EVMS complies, and continues to comply, with the EVMS guidelines referenced in paragraph (a) of this clause, and to demonstrate— (1) Proper implementation of the procedures generating the cost and schedule information being used to satisfy the contract data requirements; (2) Continuing application of the accepted company procedures in satisfying the CPR required by the contract through recurring program/project and contract surveillance; and (3) Implementation of any corrective actions identified during the surveillance process. (f) The Contractor shall be responsible for ensuring that its subcontractors, identified E:\FR\FM\13NOR1.SGM 13NOR1 66122 Federal Register / Vol. 71, No. 218 / Monday, November 13, 2006 / Rules and Regulations below, comply with the EVMS requirements of this clause as follows: (1) For subcontracts with an estimated dollar value of $50M or more, the following subcontractors shall comply with the requirements of this clause. (Contracting Officer to insert names of subcontractors or subcontracted effort). lllllllllllllllllllll lllllllllllllllllllll lllllllllllllllllllll lllllllllllllllllllll (2) For subcontracts with an estimated dollar value of less than $50M, the following subcontractors shall comply with the requirements of this clause except for the requirement in paragraph (b), if applicable, to obtain compliance/validation. (Contracting Officer to insert names of subcontractors or subcontracted effort.) lllllllllllllllllllll lllllllllllllllllllll lllllllllllllllllllll lllllllllllllllllllll (g) If the contractor identifies a need to deviate from the agreed baseline by working against an Over Target Baseline (OTB) or Over Target Schedule (OTS), the contractor shall submit to the Contracting Officer a request for approval to begin implementation of an OTB or OTS. This request shall include a top-level projection of cost and/or schedule growth, whether or not performance variances will be retained, and a schedule of implementation for the reprogramming adjustment. The Government will approve or deny the request within 30 calendar days after receipt of the request. Failure of the Government to respond within this 30-day period constitutes approval of the request. Approval of the deviation request does not constitute a change, or the basis for a change, to the negotiated cost or price of this contract, or the estimated cost of any undefinitized contract actions. (End of clause) cprice-sewell on PROD1PC66 with RULES As prescribed in 1834.203–70(b), substitute the following paragraph (b) for paragraph (b) of the basic clause: (b) If, at the time of award, the Contractor’s EVMS has not been determined by the Cognizant Federal Agency to be compliant with the EVMS guidelines, or the Contractor does not have an existing cost/schedule control system that is compliant with the guidelines in the ANSI/EIA–748 Standard (current version at the time of ward), the Contractor shall apply the system to the contract and shall take timely action to implement its plan to be compliant with the guidelines. The Government will not formally validate/accept the Contractor’s EVMS with respect to this contract. The use of the Contractor’s EVMS for this contract does not imply Government acceptance of the Contractor’s EVMS for application to future contracts. The Government will monitor compliance through routine surveillance. 15:06 Nov 09, 2006 through 1852.242–77 I 6. Sections 1852.242–74, 1852.242– 75, 1842.242–76, and 1852.242–77 are removed. [FR Doc. E6–18918 Filed 11–9–06; 8:45 am] BILLING CODE 7510–01–P DEPARTMENT OF COMMERCE National Oceanic and Atmospheric Administration 50 CFR Part 660 [Docket No. 060609159–6272–02; I.D. 060606A] RIN 0648–AU12 Fisheries Off West Coast States; Pacific Coast Groundfish Fishery; Amendment 18 National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce. ACTION: Final rule. AGENCY: SUMMARY: NMFS issues this final rule to implement Amendment 18 to the Pacific Coast Groundfish Fishery Management Plan (FMP). Amendment 18 responds to a court order by setting the Pacific Fishery Management Council’s (Council’s) bycatch minimization policies and requirements into the FMP. DATES: Effective December 13, 2006. ADDRESSES: Amendment 18 is available on the Council’s Web site at: https:// www.pcouncil.org/groundfish/ gffmp.html. FOR FURTHER INFORMATION CONTACT: (Alternate I) (NOV 2006) VerDate Aug<31>2005 1852.242–74 [Removed] Jkt 211001 Yvonne deReynier (Northwest Region, NMFS), phone: 206–526–6140; fax: 206– 526–6736; and e-mail: yvonne.dereynier@noaa.gov. SUPPLEMENTARY INFORMATION: Electronic Access The proposed and final rules for this action are accessible via the Internet at the Office of the Federal Register’s Web site at: https://www.gpoaccess.gov/fr/ index.html. The FEIS on bycatch mitigation is available on the NMFS Northwest Region Web site at: https:// www.nwr.noaa.gov/Groundfish-Halibut/ Groundfish-Fishery-Management/NEPADocuments/Programmatic-EIS.cfm and at the Council’s Web site at https:// www.pcouncil.org. Background Amendment 18 revised the FMP to set the Council’s bycatch minimization PO 00000 Frm 00030 Fmt 4700 Sfmt 4700 polices and requirements into the FMP. Amendment 18 responds to court orders in Pacific Marine Conservation Council v. Evans, 200 F.Supp.2d 1194 (N.D. Calif. 2002) [hereinafter PMCC v. Evans]. This final rule implements the following actions: require that groundfish fishery management measures take into account the cooccurrence ratios of overfished species with more abundant target stocks; require vessels that participate in the open access groundfish fisheries to carry observers if directed by NMFS; authorize the use of depth-based closed areas as a routine management measure for protecting and rebuilding overfished stocks, preventing the overfishing of any groundfish species, minimizing the incidental harvest of any protected or prohibited non-groundfish species, controlling effort to extend the fishing season, minimizing the disruption of traditional commercial fishing and marketing patterns, spreading the available recreational catch over a large number of anglers, discouraging target fishing while allowing small incidental catches to be landed, and allowing small fisheries to operate outside the normal season; update the boundary definitions of the Klamath and Columbia River Salmon Conservation Zones and Eureka nearshore area to use latitude and longitude coordinates in a style similar to that of the Groundfish Conservation Areas (GCAs); and, allow species to be identified for sorting prior to landing if there is a scientific need for those species to be separately identified upon landing. A Notice of Availability for Amendment 18 was published on June 9, 2006 (71 FR 33432). NMFS requested comments on the amendment under the Magnuson-Stevens Act FMP amendment review provisions for a 60day comment period, ending August 8, 2006. A proposed rule was published on June 27, 2006 (71 FR 36506), requesting public comment through August 8, 2006. During the Amendment 18 and proposed rule comment period, NMFS received two letters of comment. These letters are addressed later in the preamble to this final rule. The preamble to the proposed rule for this action provides additional background information on the fishery and on this final rule. Further detail on Amendment 18 also appears in the bycatch mitigation FEIS, referenced above under ‘‘Electronic Access.’’ After consideration of the public comments received on the amendment, NMFS approved Amendment 18 on September 6, 2006. E:\FR\FM\13NOR1.SGM 13NOR1

Agencies

[Federal Register Volume 71, Number 218 (Monday, November 13, 2006)]
[Rules and Regulations]
[Pages 66120-66122]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E6-18918]



[[Page 66120]]

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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1834, 1842, and 1852

RIN 2700-AD29


NASA Implementation of Earned Value Management (EVM)

AGENCY: National Aeronautics and Space Administration.

ACTION: Interim rule.

-----------------------------------------------------------------------

SUMMARY: This interim rule revises the NASA FAR Supplement (NFS) to 
implement the Federal Acquisition Regulation (FAR) EVM coverage issued 
in Federal Acquisition Circular (FAC) 2005-11.

DATES: Effective date: This interim rule is effective November 13, 
2006.
    Comment date: Interested parties should submit comments to NASA at 
the address below on or before January 12, 2007 to be considered in 
formulation of the final rule.

ADDRESSES: Interested parties may submit comments, identified by RIN 
number 2700-AD29, via the Federal eRulemaking Portal: https://
www.regulations.gov. Follow the instructions for submitting comments. 
Comments may also be submitted to Ken Sateriale, NASA Headquarters, 
Office of Procurement, Contract Management Division, Washington, DC 
20546. Comments may also be submitted by e-mail to 
ken.sateriale@nasa.gov.

FOR FURTHER INFORMATION CONTACT: Ken Sateriale, NASA, Office of 
Procurement, Contract Management Division (Suite 5K86); (202) 358-0491; 
e-mail: ken.sateriale@nasa.gov.

SUPPLEMENTARY INFORMATION:

A. Background

    FAC 2005-11 established the requirement for EVM to be implemented 
on major acquisitions as defined in OMB Circular A-11. The FAR permits 
agencies to develop provisions and clauses for their own use as long as 
they are substantially the same as those provided in the FAR.
    Accordingly, NASA has developed its own provision and clause, and 
supplemental guidance for EVM implementation. In addition to requiring 
the application of EVM to major acquisitions as described in OMB 
Circular A-11, NASA's coverage provides contract value dollar 
thresholds for EVM implementation.
    This is not a significant regulatory action and, therefore, was not 
subject to review under Section 6(b) of Executive Order 12866, 
Regulatory Planning and Review, dated September 30, 1993. This interim 
rule is not a major rule under 5 U.S.C. 804.

B. Regulatory Flexibility Act

    NASA certifies that this interim rule will not have a significant 
economic impact on a substantial number of small entities within the 
meaning of the Regulatory Flexibility Act, 5 U.S.C. 601 et seq., 
because it merely implements the FAR EVM coverage and does not impose 
an economic impact beyond that addressed in the FAC 2005-11 publication 
of the FAR final rule.

C. Paperwork Reduction Act

    The Paperwork Reduction Act (Pub. L. 104-13) is not applicable 
because the NFS changes do not impose information collection 
requirements that require the approval of the Office of Management and 
Budget under 44 U.S.C. 3501, et seq.

D. Determination To Issue an Interim Rule

    In accordance with 41 U.S.C. 418(d), NASA has determined that 
urgent and compelling reasons exist to promulgate this interim rule 
without prior opportunity for public comment. This action is necessary 
to harmonize the NFS EVM coverage with that in the FAR which was 
effective on July 5, 2006. However, pursuant to Pub. L. 98-577 and FAR 
1.501, NASA will consider public comments received in response to this 
interim rule in the formation of the final rule.

List of Subjects in 48 CFR Parts 1834, 1842, and 1852

    Government procurement.

Tom Luedtke,
Assistant Administrator for Procurement.

0
Accordingly, 48 CFR Chapter XVIII is amended as follows:

CHAPTER XVIII--[AMENDED]

0
1. Part 1834 is added to subchapter F to read as follows:

PART 1834--MAJOR SYSTEM ACQUISITION

Subpart 1834.2--Earned Value Management System
Sec.
1834.201 Policy.
1834.203 Solicitation provisions and contract clause.
1834.203-70 NASA solicitation provision and contract clause.

    Authority: 42 U.S.C. 2473(c)(1).

Subpart 1834.2--Earned Value Management System


1834.201  Policy.

    (a) Application of an Earned Value Management System (EVMS) is 
required for all acquisitions for development designated as major in 
accordance with OMB Circular A-11, and for development or production 
contracts and subcontracts, including those for flight and ground 
support requirements, and institutional requirements (facility, IT 
investment, etc.) as follows:
    (i) For contracts and subcontracts valued at $20M or more, and 
contracts and subcontracts for major acquisitions valued at less than 
$20M, the EVMS shall comply with the guidelines in the ANSI/EIA-748 
Standard.
    (ii) For contracts and subcontracts valued at $50M or more, the 
contractor shall have an EVMS that has been formally validated and 
accepted by the Government.
    (iii) For contracts and subcontracts for other than major 
acquisitions valued at less than $20M, earned value management 
application is optional and is a risk-based decision that is at the 
discretion of the program/project manager.
    (iv) EVM is not required on contracts for non-developmental 
engineering support services, steady state operations, basic and 
applied research, and routine services such as janitorial services or 
grounds maintenance services. In these cases, application of EVM is at 
the discretion of the program/project manager.
    (e) Contracting officers shall request the assistance of the 
cognizant Defense Contract Management Agency (DCMA) office in 
determining the adequacy of proposed EVMS plans.


1834.203  Solicitation provisions and contract clause.

    The FAR EVMS solicitation provisions and contract clause are not 
used in NASA contracts. See 1834.203-70 for the NASA EVMS solicitation 
provision and contract clause.


1834.203-70  NASA solicitation provision and contract clause.

    Except for the contracts identified in 1834.201(a)(iv), the 
contracting officer shall insert--
    (a) The provision at 1852.234-1, Notice of Earned Value Management 
System, in solicitations for contracts for--
    (1) Development or production, including flight and ground support 
projects, and institutional projects (facility, IT investment, etc.), 
with a value exceeding $20M; and

[[Page 66121]]

    (2) Acquisitions of any value designated as major by the project 
manager in accordance with OMB Circular A-11; and
    (b) The clause at 1852.234-2, Earned Value Management System, in 
solicitations and contracts with a value exceeding $50M that include 
the provision at 1852.234-1. The contracting officer shall use the 
clause with its Alternate I when the contract value is less than $50M.

PART 1842--CONTRACT ADMINISTRATION AND AUDIT SERVICES

0
2. The authority citation for 48 CFR part 1842 continues to read as 
follows:

    Authority: 42 U.S.C. 2473(c)(1).

Subpart 1842.74--[Removed]

0
3. Part 1842 is amended by removing Subpart 1842.74.

PART 1852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
4. The authority citation for 48 CFR part 1852 continues to read as 
follows:

    Authority: 42 U.S.C. 2473(c)(1).

0
5. Sections 1852.234-1 and 1852.234-2 are added to read as follows:


1852.234-1  Notice of Earned Value Management System.

    As prescribed in 1834.203-70(a), insert the following provision:

Notice of Earned Value Management System (NOV 2006)

    (a) The offeror shall provide documentation that its proposed 
Earned Value Management System (EVMS) complies with the EVMS 
guidelines in the American National Standards Institute (ANSI)/
Electronic Industries Alliance (EIA)-748 Standard, Earned Value 
Management Systems.
    (b) If the offeror proposes to use a system that currently does 
not meet the requirements of paragraph (a) of this provision, the 
offeror shall submit its comprehensive plan for compliance with the 
EVMS guidelines to the Government for approval.
    (1) The plan shall--
    (i) Describe the EVMS the offeror intends to use in performance 
of the contract;
    (ii) Distinguish between the offeror's existing management 
system and modifications proposed to meet the EVMS guidelines in 
ANSI/EIA-748;
    (iii) Describe the management system and its application in 
terms of the EVMS guidelines;
    (iv) Describe the proposed procedure for application of the EVMS 
requirements to subcontractors;
    (v) Describe how the offeror will ensure EVMS compliance for 
each subcontractor subject to the flowdown requirement in paragraph 
(c) whose EVMS has not been recognized by the Cognizant Federal 
Agency as compliant according to paragraph (a);
    (vi) Provide documentation describing the process and results, 
including Government participation, of any third-party or self-
evaluation of the system's compliance with the EVMS guidelines; and
    (vii) If the value of the offeror's proposal, including options, 
is $50 million or more, provide a schedule of events leading up to 
formal validation and Government acceptance of the Contractor's 
EVMS. This schedule should include progress assistance visits, the 
first visit occurring no later than 30 days after contract award, 
and a compliance review as soon as practicable. The Department of 
Defense Earned Value Management Implementation Guide (https://
acc.dau.mil/CommunityBrowser.aspx?id=19557) outlines the 
requirements for conducting a progress assistance visit and 
validation compliance review.
    (2) The offeror shall provide information and assistance as 
required by the Contracting Officer to support review of the plan.
    (3) The Government will review the offeror's EVMS implementation 
plan prior to contract award.
    (c) The offeror shall identify in its offer the major 
subcontractors, or major subcontracted effort if major 
subcontractors have not been selected, planned for application of 
the EVMS requirement. Prior to contract award, the offeror and NASA 
shall agree on the subcontractors, or subcontracted effort, subject 
to the EVMS requirement.
    (d) The offeror shall incorporate its compliance evaluation 
factors for subcontractors into the plan required by paragraph (b) 
of this provision.


(End of provision)


1852.234-2  Earned Value Management System.

    As prescribed in 1834.203-70(b) insert the following clause:

Earned Value Management System (NOV 2006)

    (a) In the performance of this contract, the Contractor shall 
use--
    (1) An Earned Value Management System (EVMS) that has been 
determined by the Cognizant Federal Agency to be compliant with the 
EVMS guidelines specified in the American National Standards 
Institute (ANSI)/Electronic Industries Alliance (EIA)--748 Standard, 
Industry Guidelines for Earned Value Management Systems (current 
version at the time of award) to manage this contract; and
    (2) Earned Value Management procedures that provide for 
generation of timely, accurate, reliable, and traceable information 
for the Contract Performance Report (CPR) required by the contract.
    (b) If, at the time of award, the Contractor's EVMS has not been 
determined by the Cognizant Federal Agency to be compliant with the 
EVMS guidelines, or the Contractor does not have an existing cost/
schedule control system that is compliant with the guidelines in the 
ANSI/EIA-748 Standard (current version at the time of award), the 
Contractor shall apply the system to the contract and shall take 
timely action to implement its plan to obtain compliance/validation. 
The Contractor shall follow and implement the approved compliance/
validation plan in a timely fashion. The Government will conduct a 
Compliance Review to assess the contactor's compliance with its 
plan, and if the Contractor does not follow the approved 
implementation schedule or correct all resulting system deficiencies 
identified as a result of the compliance review within a reasonable 
time, the Contracting Officer may take remedial action, that may 
include, but is not limited to, a reduction in fee.
    (c) The Government will conduct Integrated Baseline Reviews 
(IBRs). Such reviews shall be scheduled and conducted as early as 
practicable, and if a pre-award IBR has not been conducted, a post-
award IBR should be conducted within 180 calendar days after 
contract award, or the exercise of significant contract options, or 
within 60 calendar days after distribution of a supplemental 
agreement that implements a significant funding realignment or 
effects a significant change in contractual requirements (e.g., 
incorporation of major modifications). The objective of IBRs is for 
the Government and the Contractor to jointly assess the Contractor's 
baseline to be used for performance measurement to ensure complete 
coverage of the statement of work, logical scheduling of the work 
activities, adequate resourcing, and identification of inherent 
risks.
    (d) Unless a waiver is granted by the Cognizant Federal Agency, 
Contractor proposed EVMS changes require approval of the Cognizant 
Federal Agency prior to implementation. The Cognizant Federal Agency 
shall advise the Contractor of the acceptability of such changes 
within 30 calendar days after receipt of the notice of proposed 
changes from the Contractor. If the advance approval requirements 
are waived by the Cognizant Federal Agency, the Contractor shall 
disclose EVMS changes to the Cognizant Federal Agency at least 14 
calendar days prior to the effective date of implementation.
    (e) The Contractor agrees to provide access to all pertinent 
records and data requested by the Contracting Officer or a duly 
authorized representative. Access is to permit Government 
surveillance to ensure that the Contractor's EVMS complies, and 
continues to comply, with the EVMS guidelines referenced in 
paragraph (a) of this clause, and to demonstrate--
    (1) Proper implementation of the procedures generating the cost 
and schedule information being used to satisfy the contract data 
requirements;
    (2) Continuing application of the accepted company procedures in 
satisfying the CPR required by the contract through recurring 
program/project and contract surveillance; and
    (3) Implementation of any corrective actions identified during 
the surveillance process.
    (f) The Contractor shall be responsible for ensuring that its 
subcontractors, identified

[[Page 66122]]

below, comply with the EVMS requirements of this clause as follows:
    (1) For subcontracts with an estimated dollar value of $50M or 
more, the following subcontractors shall comply with the 
requirements of this clause.
    (Contracting Officer to insert names of subcontractors or 
subcontracted effort).
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    (2) For subcontracts with an estimated dollar value of less than 
$50M, the following subcontractors shall comply with the 
requirements of this clause except for the requirement in paragraph 
(b), if applicable, to obtain compliance/validation.
    (Contracting Officer to insert names of subcontractors or 
subcontracted effort.)
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    (g) If the contractor identifies a need to deviate from the 
agreed baseline by working against an Over Target Baseline (OTB) or 
Over Target Schedule (OTS), the contractor shall submit to the 
Contracting Officer a request for approval to begin implementation 
of an OTB or OTS. This request shall include a top-level projection 
of cost and/or schedule growth, whether or not performance variances 
will be retained, and a schedule of implementation for the 
reprogramming adjustment. The Government will approve or deny the 
request within 30 calendar days after receipt of the request. 
Failure of the Government to respond within this 30-day period 
constitutes approval of the request. Approval of the deviation 
request does not constitute a change, or the basis for a change, to 
the negotiated cost or price of this contract, or the estimated cost 
of any undefinitized contract actions.


(End of clause)

(Alternate I) (NOV 2006)

    As prescribed in 1834.203-70(b), substitute the following 
paragraph (b) for paragraph (b) of the basic clause:
    (b) If, at the time of award, the Contractor's EVMS has not been 
determined by the Cognizant Federal Agency to be compliant with the 
EVMS guidelines, or the Contractor does not have an existing cost/
schedule control system that is compliant with the guidelines in the 
ANSI/EIA-748 Standard (current version at the time of ward), the 
Contractor shall apply the system to the contract and shall take 
timely action to implement its plan to be compliant with the 
guidelines. The Government will not formally validate/accept the 
Contractor's EVMS with respect to this contract. The use of the 
Contractor's EVMS for this contract does not imply Government 
acceptance of the Contractor's EVMS for application to future 
contracts. The Government will monitor compliance through routine 
surveillance.

1852.242-74  through 1852.242-77 [Removed]

0
6. Sections 1852.242-74, 1852.242-75, 1842.242-76, and 1852.242-77 are 
removed.

[FR Doc. E6-18918 Filed 11-9-06; 8:45 am]
BILLING CODE 7510-01-P
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