Defense Federal Acquisition Regulation Supplement: Proposal Adequacy Checklist (DFARS Case 2011-D042), 18865-18876 [2013-07106]

Download as PDF Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations List of Subjects in 42 CFR Part 88 and transportation of human remains for the incident. Aerodigestive disorders, Appeal procedures, Health care, Mental health conditions, Musculoskeletal disorders, Respiratory and pulmonary diseases. ■ Text of the Rule § 88.4 Eligibility criteria—status as a WTC responder. For the reasons discussed in the preamble, the Department of Health and Human Services amends 42 CFR part 88 as follows: PART 88—WORLD TRADE CENTER HEALTH PROGRAM 1. The authority citation for part 88 continues to read as follows: ■ Authority: 42 U.S.C. 300mm–300mm–61, Pub. L. 111–347, 124 Stat. 3623. 2. Amend § 88.1 by adding the definitions of ‘‘Pentagon site,’’ ‘‘police department,’’ and ‘‘Shanksville, Pennsylvania site,’’ in alphabetical order, to read as follows: ■ § 88.1 Definitions. srobinson on DSK4SPTVN1PROD with RULES * * * * * Pentagon site means any area of the land (consisting of approximately 280 acres) and improvements thereon, located in Arlington, Virginia, on which the Pentagon Office Building, Federal Building Number 2, the Pentagon heating and sewage treatment plants, and other related facilities are located, including various areas designated for the parking of vehicles, vehicle access, and other areas immediately adjacent to the land or improvements previously described that were affected by the terrorist-related aircraft crash on September 11, 2001; and those areas at Fort Belvoir in Fairfax County, Virginia and at the Dover Port Mortuary at Dover Air Force Base in Delaware involved in the recovery, identification, and transportation of human remains for the incident. Police department means any law enforcement department or agency, whether under Federal, state, or local jurisdiction, responsible for general police duties, such as maintenance of public order, safety, or health, enforcement of laws, or otherwise charged with prevention, detection, investigation, or prosecution of crimes. * * * * * Shanksville, Pennsylvania site means the property in Stonycreek Township, Somerset County, Pennsylvania, which is bounded by Route 30 (Lincoln Highway), State Route 1019 (Buckstown Road), and State Route 1007 (Lambertsville Road); and those areas at the Pennsylvania National Guard Armory in Friedens, Pennsylvania involved in the recovery, identification, VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 3. Amend § 88.4 by adding paragraphs (b) and (c) to read as follows: * * * * * (b) Responders to the Pentagon site of the September 11, 2001, terrorist attacks, may apply for enrollment in the WTC Health Program on or after April 29, 2013. Individuals must meet the criteria below to be considered eligible for enrollment: (1) The individual was an active or retired member of a fire or police department (fire or emergency personnel), worked for a recovery or cleanup contractor, or was a volunteer; and (2) Performed rescue, recovery, demolition, debris cleanup, or other related services at the Pentagon site of the September 11, 2001, terrorist attacks, for at least 1 day beginning September 11, 2001, and ending on November 19, 2001. (c) Responders to the Shanksville, Pennsylvania site of the September 11, 2001, terrorist attacks, may apply for enrollment in the WTC Health Program on or after April 29, 2013. Individuals must meet the criteria below to be considered eligible for enrollment: (1) The individual was an active or retired member of a fire or police department (fire or emergency personnel), worked for a recovery or cleanup contractor, or was a volunteer; and (2) Performed rescue, recovery, demolition, debris cleanup, or other related services at the Shanksville, Pennsylvania site of the September 11, 2001, terrorist attacks, for at least 1 day beginning September 11, 2001, and ending on October 3, 2001. * * * * * Dated: October 2, 2012. John Howard, Administrator, World Trade Center Health Program and Director, National Institute for Occupational Safety and Health, Centers for Disease Control and Prevention, Department of Health and Human Services. [FR Doc. 2013–07146 Filed 3–27–13; 8:45 am] BILLING CODE 4163–18–P PO 00000 Frm 00071 Fmt 4700 Sfmt 4700 18865 DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Parts 215 and 252 RIN 0750–AH47 Defense Federal Acquisition Regulation Supplement: Proposal Adequacy Checklist (DFARS Case 2011–D042) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Final rule. AGENCY: SUMMARY: DoD is issuing a final rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to incorporate a proposal adequacy checklist for proposals in response to solicitations that require submission of certified cost or pricing data. Effective Date: March 28, 2013 Mr. Dustin Pitsch, telephone 571–372–6090. SUPPLEMENTARY INFORMATION: DATES: FOR FURTHER INFORMATION CONTACT: I. Background DoD published a proposed rule in the Federal Register at 76 FR 75512 on December 2, 2011, to incorporate the requirement for a proposal adequacy checklist into DFARS 215.408, and an associated solicitation provision at 252.215–7009, to ensure offerors take responsibility for submitting thorough, accurate, and complete proposals. Fifteen respondents submitted public comments in response to the proposed rule. II. Discussion and Analysis of the Public Comments DoD reviewed the public comments in the development of the final rule. A discussion of the comments and the changes made to the rule as a result of those comments is provided, as follows: A. Summary of significant changes from the proposed rule. • The sentence ‘‘Completion of this checklist in no way reduces the responsibility to fully comply with all of the requirements of 41 U.S.C. chapter 35, Truthful Cost or Pricing Data, and any other special requirements of the solicitation.’’ is removed from the checklist instructions at DFARS 252.215–7009. • The sentence ‘‘In preparation of the offeror’s checklist, offerors may elect to have their prospective subcontractors use the same or similar checklist as appropriate.’’ was added to the end of E:\FR\FM\28MRR1.SGM 28MRR1 srobinson on DSK4SPTVN1PROD with RULES 18866 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations the checklist instructions at DFARS 252.215–7009. The following checklist items are referred to by their proposed rule numbering scheme: • Checklist item 2 is modified to change the word ‘‘lending’’ to ‘‘accountable’’. • Checklist item 3 is modified to read ‘‘Does the proposal identify and explain notifications of noncompliance with CASB or CAS; any proposal inconsistencies with your disclosed practices or applicable CAS; and inconsistencies with your established estimating and accounting principles and procedures?’’ • Checklist item 4 is modified to read ‘‘Does the proposal disclose any other known activity that could materially impact the costs?’’ and now includes the list of eight sample factors that appear in the definition of ‘‘cost or pricing data’’ at FAR 2.101. The reference column is updated to add FAR 2.101, ‘‘Cost or pricing data’’. • Checklist item 9 is revised in response to public comments to provide a different reference. • Checklist item 10 has added the phrase ‘‘including breakdown by year’’ after ‘‘consistent with your cost accounting system’’. • Checklist items 11 and 13 are removed in response to public comments and are covered by final rule item 10, as revised. • Checklist item 14 is removed in response to public comments and final rule checklist item 4 was modified to include that non-recurring costs should be noted in the proposal along with other known activity that could materially impact costs. • Checklist item 16 (final rule item 13) is modified to read ‘‘Is there a Government forward pricing rate agreement (FPRA)? If so, the offeror shall identify the official submittal of such rate and factor data.’’ Checklist item 33 from the proposed rule, has been revised and combined with final rule item 13, to address the proposal requirements if there is no FPRA. • Checklist item 17 is removed in response to public comments. • Checklist item 18 (final rule item 14) is modified to note that a consolidated summary of individual material and services is ‘‘frequently referred to as a Consolidated Bill of Materials (CBOM)’’. • Checklist item 19 (final rule item 15) is modified to read ‘‘Has the offeror identified in the proposal those subcontractor proposals, for which the contracting officer has initiated or may need to request field pricing analysis?’’ and to add the reference ‘‘DFARS 215.404–3.’’ VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 • Checklist item 20 (final rule item 16) is modified to remove ‘‘proposal(s)’’ and add ‘‘certified cost or pricing data’’. • Checklist item 21 (final rule item 17) is combined with checklist item 22 and modified to read ‘‘Is there a Price/ Cost Analysis establishing the reasonableness of each of the proposed subcontracts included with the proposal? If the offeror’s price/cost analyses are not provided with the proposal, does the proposal include a matrix identifying dates for receipt of subcontractor proposal, completion of fact finding for purposes of price/cost analysis, and submission of the price/ cost analysis?’’ • The sections of the checklist titled ‘‘COMMERCIAL ITEM DETERMINATION’’ and ‘‘ADEQUATE PRICE COMPETITION’’ are now titled ‘‘EXCEPTIONS TO CERTIFIED COST OR PRICING DATA.’’ • Checklist item 23 (final rule item 18) is modified to read ‘‘Has the Offeror submitted any exceptions to the submission of certified cost or pricing data for commercial items proposed either at the prime or subcontractor level, in accordance with provision 52.215–20?’’ and now contains a list of the questions from items 24 through 26. The reference column is updated to read ‘‘FAR 52.215–20’’ And ‘‘FAR 2.101, commercial item.’’ • Checklist item 27 (final rule item 19) is modified to read ‘‘Does the proposal include a price analysis for all commercial items offered that are not available to the general public?’’ • Checklist item 32 (final rule item 24) is modified to read ‘‘For labor Basis of Estimates, does the proposal include labor categories, labor hours, and task descriptions, (e.g.; Statement of Work reference, applicable CLIN, Work Breakdown Structure, rationale for estimate, applicable history, and timephasing)?’’ • Checklist item 33 is removed and relocated within final rule item 13 in response to public comments. • Checklist item 35 (final rule item 26) is modified to add ‘‘and how they are applied.’’ • Checklist item 43 is removed in response to public comments. • Checklist item 44 (final rule 34) is revised in response to public comments to provide a different reference in the reference column and to address all types of economic price adjustments, not just those based on indices. • Checklist item 45 (final rule item 35) is modified to read ‘‘If the offeror is proposing Performance-Based Payments did the offeror comply with FAR clause 52.232–28?’’ and the reference is updated to read ‘‘FAR 52.232–28.’’ PO 00000 Frm 00072 Fmt 4700 Sfmt 4700 • Checklist item 47 is removed in response to public comments. B. Analysis of Public Comments. 1. Increased Cost Comment: Two respondents stated that this new rule would result in increased costs that will ultimately be passed on to the Government and may be financially prohibitive to seeking other business. Response: This provision results from a long history of incomplete proposals resulting in rework and lost time, and it aims to achieve cost savings by improving initial proposal submissions from contractors. 2. Improved Efficiency Comment: One respondent noted that the checklist will improve efficiency on both sides of the contract and that DOD will save time because they will have all the answers they need to determine which contractor is best for the Government. Response: This comment accurately expresses the goals of this rule. 3. Paperwork Reduction Act Comment: Several respondents believed that this checklist imposes additional reporting requirements on the contractor and note that many of the checklist items are not currently required for submission of certified cost or pricing data. One respondent noted that while this checklist adds the new requirements it appears to add no value to the contracting process. Response: This rule does not impose additional requirements over what is already required under the conditions where certified cost or pricing data are required and these requirements are already covered by OMB Control Number 9000–0013. This provision is applicable to solicitations with an estimated value greater than the TINA threshold and that require certified cost or pricing data. This provision intends to increase uniformity across DoD, minimize local variations, and thereby decrease proposal preparation costs. 4. Unnecessary and Duplicative Comment: Several respondents suggested that the checklist is unnecessary and duplicative. One respondent noted that it is the offeror’s responsibility to comply with the requirements of the solicitation and an offeror that is unable to submit a compliant proposal is likely to be noncompliant after award. The same respondent noted that this checklist is somewhat duplicative of the DCAA forward pricing adequacy checklist. Another noted that most of the checklist E:\FR\FM\28MRR1.SGM 28MRR1 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations items already appear in FAR 15.408 at table 15–2 and suggested that the rule should require contractors confirm that their proposal complies with all applicable requirements of 15–2. Another respondent noted that this rule is: (1) Not compliant with Executive Order 12866 as there is no defined problem that this rule aims to solve; (2) the rule is inconsistent, incompatible and duplicative of what is already in Table 15–2; and (3) that this checklist only adds a layer of regulatory requirements. Response: This provision is a single, uniform tool that is applicable across DoD to address the inconsistent interpretations of Table 15–2. The intent of this provision is to increase uniformity across DoD, minimize local variations, and thereby decrease proposal preparation costs. The checklist created by this rule is a DFARS provision; any checklist that DCAA currently uses is outside the scope of this rule. 5. Belongs in Procedures, Guidance, and Information (PGI) Comment: Several of the respondents suggested that this checklist should be incorporated into the DFARS PGI as it seems that it is intended to be a tool for assisting contracting officers in determining the adequacy of proposal and not a regulatory requirement. Response: This provision impacts contractors; therefore it must be in the DFARS. Language added to the DFARS PGI cannot have any effect on the public and exists to assist contracting officers. srobinson on DSK4SPTVN1PROD with RULES 6. Better Buying Power (BBP) Comment: Several respondents stated that the proposed rule does not support the BBP Initiative and noted that the rule does not align with any of the 23 principal actions. The respondents believed that the proposed rule is contrary to the BBP Initiative to reduce nonproductive processes and bureaucracy. Response: While this initiative predates BBP, it is consistent with the BBP’s cost reduction initiatives. 7. Self validation Comment: Several comments were received regarding the possibility of contractors self validating their proposal through the use of the checklist. The respondents noted that: (1) The contractor has always been responsible for meeting the requirements of the solicitation; (2) use of the checklist will not relieve the contracting officers of the responsibility of determining the proposal adequate; and (3) it is likely that time and resources will be wasted VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 reviewing the checklist instead of reviewing the proposal. Response: This provision should result in cost savings by improving initial proposal submissions from offerors and reduce the amount of rework and resubmissions. Because the offeror will specify where to find required information in its proposal, this provision aims to achieve time savings for contracting officers. 8. Protest potential Comment: One respondent suggested that this rule creates additional potential for protests as acceptance of the checklist or the non-rejection of the checklist would allow contractors to claim they have met all solicitation requirements and were unfairly denied award. Response: This checklist is intended to facilitate the contractor submitting an adequate proposal. The checklist is not intended to be a standalone decision document; it will be used by contracting officials in reviewing proposals when certified cost or pricing data are required. 9. Require Checklist (Shall/Should) Comment: One respondent suggested changing the clause prescription at 215.408(3) to read that the contracting officer ‘‘shall’’ use the checklist instead of ‘‘should’’ as is used in the proposed rule. This respondent believed that nonstandard mandatory use of the checklist will cause confusion across the DoD and industry. Response: Because of the wide variance in requirements, the contracting officer will have discretion to determine applicability to the requirements. 10. Corrective Actions Comment: Two respondents suggested that there should be penalties associated with non-submission of the checklist. Response: The checklist is intended to be a tool to assist contractors to provide adequate, compliant proposals; it is not meant to be punitive. Non-receipt of the checklist may result in extending the proposal evaluation and delaying contract award. 11. Contracting Officer Determination Comment: One respondent suggested that the contracting officer should specify which items on the checklist will be required and where data other than certified cost or pricing data are required. Response: This provision is to be included only in solicitations requiring certified cost or pricing data. PO 00000 Frm 00073 Fmt 4700 Sfmt 4700 18867 12. Tailoring Comment: One respondent suggested that the contracting officer should be able to tailor the checklist as necessary to each acquisition. Response: The solicitation provision will be utilized in its entirety. This is a tool for offerors to improve the initial proposal submission, ensuring adequacy and completeness. 13. Subcontractor Flowdown Comment: Several comments were received regarding the applicability of the checklist to subcontractors as the proposed rule has no guidance on this. One of the respondents noted that flowdown to require subcontractor to use the checklist would add a significant amount of time to proposal preparation. Response: The checklist is not required to flow down to subcontractors, but prime contractors may elect to use it for their prospective subcontractors’ proposals. 14. Solicitation Process Changes Comment: One respondent made several suggestions toward the overall solicitation process including: (1) Not allowing proposal costs to be billed directly if the proposal is inadequate; (2) requiring contractors to justify their proposed fee with a risk analysis; (3) requiring, for all proposal modifications, a total proposal resubmission; (4) requiring more detail in contractor’s analysis of subcontractor proposals; and (5) creating a requirement that postaward subcontractor cost savings should be passed on to the Government. Response: These comments are beyond the scope of this rule. 15. Section L Comment: One respondent stated that many of the checklist items are already called out in section L of the solicitation and suggested that section L could be modified to reflect the pertinent items in the checklist. Response: The solicitation provision created by this rule will go in section L of the solicitation, and it is meant to supplement the other instructions for circumstances where certified cost or pricing data will be required. 16. Remove ‘‘compliance’’ Statement Comment: One respondent suggested removing the ‘‘compliance’’ statement directly preceding the checklist at clause 252.215–7009. Response: The provision is modified to remove ‘‘Completion of this checklist in no way reduces the responsibility to fully comply with all of the requirements of 41 U.S.C. chapter 35, E:\FR\FM\28MRR1.SGM 28MRR1 18868 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations Truthful Cost or Pricing Data, and any other special requirements of the solicitation.’’ Response: This is outside the scope of this rule; it is already required by the solicitation. 17. Indefinite-Delivery IndefiniteQuantity (IDIQ) Applicability 21. Proposal Requirements Comment: One respondent stated that the checklist is not appropriate for IDIQ solicitations and awards. The respondent stated that this is because IDIQs often provide a placeholder value or a predetermined bill of material that the offeror must use, but the checklist implies that the offeror is responsible for all of the TINA requirements for a value in the proposal that has been directed by the Government. Response: This checklist is applicable to solicitations that require certified price and costing data. When a predetermined bill of materials is provided by the Government, certified cost or price data is not required for that cost element. 18. Certified Bill of Materials (CBOM) Comment: One respondent stated that the Government’s requirement for a CBOM is not always consistently interpreted or applied which, at times, has resulted in unnecessary costs to the Government in the name of compliance. The checklist should encourage contractors to discuss BOM requirements with the contracting officer prior to preparing the proposal where a single CBOM (in an electronic format) is not consistent with the contractor’s current (and approved) practices. Further, the contracting officer should be allowed the reasonable discretion to decide what information or format is truly necessary for determining a price fair and reasonable. Response: The rule does not restrict communication among the parties. Specific submission requirements can be included in section L of the solicitation at the contracting officer’s discretion. Comment: One respondent requested adding a question in the ‘‘General Instructions’’ to assess whether the offeror addressed the specific requirements of the contracting officer within the proposal. Response: This checklist addresses proposals that will require certified cost or pricing data. Specific submission requirements can be included in section L of the solicitation at the contracting officer’s discretion. 22. General Instructions Comment: One respondent suggested adding under ‘‘General Instructions’’ the following three items: a. Does the proposal comply with the RFP in regard to data rights? b. Does the proposal comply with the RFP regarding the applicable requirements relative to submission of subcontracting plan, Cost and Software Data Reporting (DFARS 252.234–7003, 252.234–7004), EVM, Unique Item Identification (UID) and specialty metals?’’ Response: This checklist applies only to the cost proposal and not the proposal in its entirety. 23. Column Heading Comment: One respondent stated that the terms ‘‘Offeror’’ and ‘‘contractor’’ should be used consistently and not interchangeably to minimize confusion. Response: All ‘‘contractor’’ references have been changed to ‘‘offeror’’ in the DFARS text and provision. Comment: One respondent requested changing the format of the checklist to include a ‘‘Y/N/N/A’’ column. Response: The checklist is designed to be open-ended. An explanation should be provided when ‘‘not applicable.’’ A column with ‘‘Y/N/N/A’’ is not necessary. If the offeror fills in the checklist with a page number(s) in the ‘‘Proposal Page No.’’ column this would denote that ‘‘yes’’ the item has been provided. If the contractor enters something in the ‘‘If not provided EXPLAIN’’ column, this would denote that the item has not been provided and there should be an explanation as to why the item has not been provided. The item not being applicable for the particular proposal can be included with the explanation as to why it has not been provided. 20. CAGE and DUNS 24. Checklist Item 1 Comment: One respondent suggested that proposals include both the CAGE and DUNS numbers of the offeror in order to more effectively monitor offeror compliance with forward pricing rate recommendations and forward pricing rate agreements. Comment: Two respondents recommended modifying the reference block for item 1 to accurately reflect the two items being referred to in FAR table 15–2. Response: The reference is changed to ‘‘Paragraph A.’’ srobinson on DSK4SPTVN1PROD with RULES 19. Contractor Versus Offeror VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 PO 00000 Frm 00074 Fmt 4700 Sfmt 4700 25. Checklist Item 2 Comment: One respondent recommended the terminology in the checklist item for Governmentfurnished material/tooling/test equipment be made consistent with the FAR reference for Government property. Another respondent suggested requiring a cost impact study if Governmentfurnished property/material/tooling/test equipment is denied. One respondent requested replacing the term ‘‘lending’’ with ‘‘accountable’’ in order to be consistent with the FAR. Response: The DFARS text is changed to replace the term ‘‘lending’’ with ‘‘accountable’’. A cost impact study is outside the scope of this rule. 26. Checklist Item 3 Comment: One respondent suggested changing the checklist item to ask whether the offeror has been notified of any CAS noncompliance or other estimating deficiencies that may impact the proposed price. Another respondent recommended requiring the offeror to evaluate the magnitude of the impact of the CAS noncompliance or deficiency on estimated costs, describe the offeror’s efforts to correct the noncompliance, and propose a method of dealing with the noncompliance in the negotiated agreement. One respondent stated that no FAR references or any other FAR or DFARS clauses currently require an offeror to disclose estimating deficiencies in a proposal and this checklist item would create a new requirement for an offeror. Response: This item is revised to read ‘‘Does the proposal identify and explain notifications of noncompliance with CASD or CAS; any proposal inconsistencies with your disclosed practices or applicable CAS; and inconsistencies with our established estimating and accounting principles and procedures?’’ to more closely align with table 15–2. 27. Checklist Item 4 Comment: One respondent stated some of the terms in the checklist were newly created for the checklist and were not directly from the requirements already in the Federal Acquisition Regulation (FAR). The respondent suggested the inclusion of new terms would cause inconsistency that may lead to confusion. The FAR reference was also questioned. Response: This checklist item is modified to read ‘‘Does the proposal disclose any other known activity that could materially impact the costs?’’ and now includes the list of eight sample factors that appear in the definition of E:\FR\FM\28MRR1.SGM 28MRR1 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations ‘‘cost or pricing data’’ at FAR 2.101. The reference column is updated to add FAR 2.101, ‘‘cost or pricing data.’’ 28. Checklist Item 7 Comment: Two respondents stated it would be wastefully time consuming and burdensome for offerors to disclose which pages of the proposal contain a judgmental factor applied and the mathematical or other methods used in the estimate. The respondents suggested a large percentage of the pages comprising the proposal would contain such information. Response: Having contractors identify this information prevents miscommunication and misunderstanding, and it will save time in the proposal evaluation process. 29. Checklist Item 9 Comments: One respondent stated the FAR reference was not applicable because it pertains to CLINS instead of cost estimating relationships. One respondent suggested the checklist item should include an additional requirement that the offeror explain how the cost estimating relationship (CER) is applied. Response: This reference for the item has been change to cite Section II, Paragraphs A and B of Table 15–2. These references require the basis of estimate. CER is a basis of estimate that could be used when cost is not proposed on a discrete basis. srobinson on DSK4SPTVN1PROD with RULES 30. Checklist Item 10 Comment: One respondent stated the FAR reference was not applicable because it pertains to CLINS instead of cost elements. Response: Paragraph D is referenced because it specifically requests offeror to provide cost element breakdown for each proposed line item. The checklist does not directly restate every item of table 15–2 as it is meant to be used as a tool to ensure all necessary elements have been included with the proposal. 31. Checklist Item 11 Comments: One respondent noted the FAR reference to paragraph D was not applicable. Another respondent commented the item would introduce a new requirement because paragraph D does not require a yearly breakdown by either total price or cost element. Response: This element is removed from the checklist as it is covered by final rule item 10; breakdowns for cost elements must be consistent with the cost accounting system. 32. Checklist Item 13 Comments: One respondent noted the FAR reference to paragraph E was not VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 18869 applicable. Another respondent commented the item would introduce a new requirement because paragraph D does not require a yearly breakdown by either total price or cost element. Response: This element is removed from the checklist as it is covered by final rule item 10; breakdowns for cost elements must be consistent with the cost accounting system. intent of this rule. Specific submission requirements can be included in section L of the solicitation at the contracting officer’s discretion. The checklist is not intended to dictate all specific requirements for every solicitation in which it is used. 33. Checklist Item 14 Comments: One respondent noted the FAR reference to paragraph E was not applicable. Another respondent commented the item would introduce a new requirement because the offeror currently does not have to segregate recurring and non-recurring costs at the CLIN/Sub-CLIN and total cost levels. Response: This checklist item is removed as non-recurring costs are cited in the definition of ‘‘cost or pricing data’’ at FAR 2.101 and should be noted in response to checklist item 4. Comments: Several respondents suggested additional language to inform offerors that they must still perform price and cost analysis when an assist audit has been requested on a subcontractor. One respondent suggested the checklist item be modified or eliminated because contracting officers and DCAA, not prime contractors have the authority to request assist audits of subcontractors. Another respondent requested amending the checklist item to direct the offeror to inform the contracting officer as soon as possible of the need for an assist audit resulting from proprietary data rights assertions. Response: A reference for item 19 is added to reflect ‘‘DFARS 215.404–3’’ and the checklist item is modified to read ‘‘Has the offeror identified in the proposal those subcontractor proposals, for which the contracting officer has initiated or may need to request field pricing analysis?’’ 34. Checklist Item 17 Comments: Several respondents stated the checklist item for a description of supplies and services addresses non-cost information and should be eliminated. The respondents commented that the checklist item would create a new reporting requirement for offerors because this is not currently a FAR or DFARS requirement. Response: Since item 17 requests noncost information, it is removed from the final rule. The basis on which supplies or services meet the need of the Government should be developed within the proposal. 35. Checklist Item 18 (Final Rule Item 14) Comments: One respondent requested the language of the checklist item be expanded to inquire whether the offeror’s estimating technique is appropriate and whether interorganizational transfers are included in the Consolidated Bill of Materials. Several respondents suggested a requirement that an offeror provide an electronic version of the CBOM that can be sorted by supplier, category, quantity, unit price, extended price of parts number, and identification of commercial items. Another respondent imparted the rationale that was utilized to reach the final version of the Air Force Proposal Adequacy Checklist and cautioned expanding the scope for this checklist item. Response: The suggested items, as well as requiring an electronic submission that can be sorted, would be new reporting requirements beyond the PO 00000 Frm 00075 Fmt 4700 Sfmt 4700 36. Checklist Item 19 (Final Rule Item 15) 37. Checklist Item 20 (Final Rule Item 16) Comments: One respondent proposed the FAR reference be revised to match that of item 18. Two respondents suggested modifying the language. One suggested: ‘‘Per the thresholds of FAR 15.404–3(c), Subcontract Pricing Considerations, does the proposal include either a copy of the applicable subcontractor’s proposals or the date by which these proposals will be submitted directly from the subcontractor? If proposals are to be submitted, annotate the projected date provided of submission in ‘explanation’ column of this checklist.’’ The other respondent suggested modifying the language to read: ‘‘* * * does the proposal include a copy of the applicable subcontractor’s certified cost or pricing data?’’ Response: The item reference is revised to add ‘‘FAR 52.244–2’’. The submission item text will be modified to incorporate the second respondent’s suggestion of ‘‘* * * does the proposal include a copy of the applicable subcontractor’s certified cost or pricing data?’’ If the answer is ‘‘no,’’ the explanation should state how and when the data will be provided. E:\FR\FM\28MRR1.SGM 28MRR1 18870 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations 38. Checklist Item 21 (Final Rule Item 17) Comments: One respondent noted the language in checklist items 21 and 22 should be consistent when addressing an offeror’s price/cost analysis of subcontracts. One respondent suggested the checklist item question be modified to ask whether a prime contractor’s price/cost analysis of each proposed subcontract greater than $700,000 is included in the proposal. Response: Item 21 is modified to read ‘‘Is there a price/cost analysis establishing the reasonableness of each of the proposed subcontracts included with the proposal?’’ A price or cost analysis must be accomplished on all subcontractor proposals; there is no dollar threshold for this. 39. Checklist Item 22 (Final Rule Item 17) Comments: One respondent stated the checklist item would create a new reporting requirement for offerors because this is not currently a FAR or DFARS clause that requires an offeror to provide a matrix of anticipated dates for the receipt of proposals from subcontractors. Other respondents recommended identifying the offeror as a prime contractor and using the language consistently when addressing an offeror’s price/cost analysis of subcontracts. Response: This is only necessary if a proposal is incomplete because the information in the preceding checklist item has not been submitted. The checklist is not generating a new reporting requirement; it is only requesting remaining proposal components submission date for adequacy. This item has been combined with the previous checklist item (item 21 which is item 16 in the final rule) to clarify that it is a follow-up that is only necessary when an analysis has not yet been submitted for each subcontract. srobinson on DSK4SPTVN1PROD with RULES 40. Checklist Item 23 (Final Rule Item 18) Comments: One respondent commented the item would introduce a new requirement because it is not currently mandatory for the offeror to indicate whether commercial items would be exempt for certified cost or pricing data requirements. The respondent noted a contracting officer may require data other than certified cost or pricing data when a commercial item is being acquired. Another respondent suggested the offeror provide the rationale for commercial items listed as exempt from certified cost or pricing data requirements. VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 Response: This is not a new reporting requirement as this item allows the offeror to acknowledge an allowable exemption to the requirement for certified cost or pricing data at the prime or subcontractor level. The item is modified to read ‘‘Has the Offeror submitted any exceptions to the submission of certified cost or pricing data for commercial items proposed either at the prime or subcontractor level, in accordance with provision 52.215–20?’’ and now contains a bulleted list of the questions from items 24 through 26. The reference column is updated to read ‘‘FAR 52.215–20’’ and ‘‘FAR 2.101, commercial item.’’ Comments: One respondent noted the FAR reference only points to the definition of a commercial item and does not reference a FAR instruction for an offeror to provide a technical description of the differences between the proposed item and the comparison item. Response: This item is removed because the requirements at 52.215–20 are consolidated in checklist item 23 (final rule item 17) making this item redundant. 42. Checklist Item 25 Comments: One respondent commented the checklist item would create a new reporting requirement for offerors because the FAR currently states a contracting officer may require data other than certified cost or pricing data but does not require an offeror to provide such information for every proposal. Another respondent suggested including language that a minor modification must meet the definition in FAR 2.101 in order to clarify the requirements of a commercial item exemption. One respondent requested the checklist item ask the offeror to justify, in addition to classifying, the modification. Several respondents requested the replacement of the phrase ‘‘see note below’’ with language that informs the offeror modifications that do not qualify as minor under FAR 2.101 or modifications that qualify as minor where the total price of all such modifications exceed the greater of the thresholds for certified cost or pricing data or 5% of the total price of the contract are not exempt from the submission of certified cost or pricing data. Response: This item is removed because the requirements at 52.215–20 are consolidated in checklist item 23 (final rule item 18) making this item redundant. Frm 00076 Fmt 4700 Comments: One respondent stated the checklist item only references the definition of a commercial item and would create a new reporting requirement for offerors because this is not currently a FAR or DFARS requirement for an offeror to provide a technical description of the differences between the proposed item and the comparison item. Response: This item is removed because the requirements at 52.215–20 are consolidated in checklist item 23 (final rule item 18) making this item redundant. 44. Checklist Item 27 (Final Rule Item 19) 41. Checklist Item 24 PO 00000 43. Checklist Item 26 Sfmt 4700 Comments: Several respondents suggested additional requirements for the offeror to provide data other than certified cost or pricing data to support a determination of price reasonableness for commercial items such as data related competition, market prices, costs, etc. One respondent stated that the reference was incorrect because cost or pricing data are not required for commercial items and if such information were required, it creates a new reporting requirement for offerors because this is not currently a FAR or DFARS requirement for an offeror. Response: The contracting officer would have to decide during discussions if other than certified cost or pricing data will be necessary. This is not a new requirement; it is a reminder that a price analysis is still required when certified cost or pricing data are not required. The FAR reference is revised to reflect ‘‘FAR 15.408, Table 15–2, Section II Paragraph A’’ and rephrased to address ‘‘a price analysis for all commercial items offered that are not available to the general public.’’ 45. Checklist Item 30 (Final Rule Item 22) Comments: One respondent suggested amending the FAR reference for the requirement to provide analysis for inter-organizational transfers. Response: The table 15–2 reference is added to the references column in the final rule (Paragraph A(1) Section II Table 15–2). 46. Checklist Item 31 (Final Rule Item 23) Comments: One respondent noted the importance of well referenced information regarding the types, time phasing, and WBS for direct labor so that the cost element summary can be reconciled with the basis of estimates. E:\FR\FM\28MRR1.SGM 28MRR1 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations Response: The checklist is intended to assist contractors in providing well referenced proposal information. 47. Checklist Item 32 (Final Rule Item 24) Comments: One respondent noted the checklist item would impose a new requirement on offerors since the FAR reference requires a time-phased breakdown of labor hours, rates, and cost by appropriate category but does not require task descriptions, statementof-work reference, applicable CLIN, work breakdown structure (WBS), rationale for estimate and other detailed breakdowns. Another responded reiterated the importance of well referenced information regarding the types, time phasing, and WBS for direct labor so that the cost element summary can be with reconciled with the basis of estimates. Response: The checklist item is modified to include the list of examples ‘‘Statement of Work reference, applicable CLIN, work breakdown structure, rationale for estimate, applicable history, and time-phasing’’ in parentheses. Also, ‘‘e.g.’’ has been added at the beginning of this list to further denote that the items are merely examples. srobinson on DSK4SPTVN1PROD with RULES 48. Checklist Item 33 (Final Rule Item 13) Comments: One respondent recommended relocating the content of checklist item 33 into the ‘‘General Instructions.’’ Another respondent suggested a requirement that an offeror provide historical direct labor rates for proposed labor categories if a FPRA/ FPRP is not available. Ifhistorical direct labor rates are also not available the respondent requests an offeror provide marketplace analysis for the proposed labor categories. Response: This item is relocated to the ‘‘General Instructions’’ section of the checklist and consolidated with item 16 (final rule item 13). 49. Checklist Item 35 (Final Rule Item 26) Comments: Several respondents request including additional guidance in the checklist item so offerors more clearly explain how indirect rates are developed and applied throughout the proposal. Response: The rule text is modified to include ‘‘and how they are applied?’’ 50. Checklist Item 36 (Final Rule Item 27) Comments: One respondent stated the language of the checklist item should be amended to distinguish when travel is VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 proposed as a direct cost because it may not always be proposed as such and the question requirement would not be applicable. Another respondent stated the checklist item creates a new reporting requirement for offerors because this is no current FAR or DFARS requirement. Response: The travel details listed in item 36 are not spelled out in table 15– 2; however they are the necessary details to provide an adequate basis for pricing of direct travel. 51. Checklist Item 40 (Final Rule Item 31) Comments: One respondent stated the checklist item duplicates the requirement listed in checklist item 39 which addresses cost element breakdowns of all types of proposals. Response: The tables are represented in separate checklist items to accentuate that they are each used in different circumstances. 52. Checklist Item 41 (Final Rule Item 32) Comments: One respondent stated the checklist item duplicates the requirement listed in checklist item 39 which addresses cost element breakdowns of all types of proposals. Response: The tables are represented in separate checklist items to accentuate that they are each used in different circumstances. 53. Checklist Item 43 Comments: One respondent commented that the item would introduce a new requirement because the checklist item requires the offeror to state that the fee is in accordance with statutory requirements whereas the FAR reference identifies a requirement on the contracting officer to verify the fee does not exceed statutory requirements. Response: This item is removed because the contracting officer determines if the fee is appropriate in accordance with the regulations, not the offeror. 54. Checklist Item 44 (Final Rule Item 34) Comments: One respondent recommended the removal of item 44 in the checklist regarding the rationale and application of economic price adjustment in a proposal. The respondent noted the inclusion of the item on the checklist may encourage an offeror to propose the use of economic price adjustments, which would not be desirable to the Government because of the of the administrative burden. The respondent also stated the checklist item assumes an economic price PO 00000 Frm 00077 Fmt 4700 Sfmt 4700 18871 adjustment with indices when indices are only one of the methods available. The FAR reference was also questioned. Response: This item is revised to address all type of economic incentive arrangements and a new reference has been provided to FAR 16.203–4 and FAR 15.408 Table 15–2, Section II, Paragraphs A, B, C, and D. 55. Checklist Item 45 (Final Rule Item 35) Comments: One respondent suggested that the checklist item should clarify that an offeror can propose a separate price for performance based payments which are negotiated after award. Another respondent stated that the checklist item creates a new reporting requirement for offerors because there is no current FAR or DFARS requirement for an offeror to provide an expenditure profile. Response: The reference is modified to reflect FAR 52.232–28 and the item is modified to read as follows: ‘‘If the offeror is proposing Performance-Based Payments, did the offeror comply with FAR 52.232–28?’’ The provision at FAR 52.232–28 is included in solicitations when offerors are invited to propose performance based payments and the provision includes all of the necessary information for submission. 56. Checklist Item 46 (Final Rule Item 36) Comments: One respondent suggested expanding checklist item 46 to require identification and explanation of any higher tier subcontractors rather than limiting the requirement to only subcontractors supplying the prime contractor. Another respondent recommended the FAR reference be amended to include FAR 52.215–22. Response: References to FAR clauses 52.215–22 and 52.215–23 are added. This checklist is addressed to the offeror and not to the subcontractors. When the prime is subcontracting more than 70% of the effort, the contractor is required to disclose this in the proposal. 57. Checklist Item 47 Comments: One respondent commented the item would introduce a new requirement because the checklist item does not make reference to a current requirement within the FAR. Response: This item is removed as point of contact data is already required by table 15–2 Section I (A)(3), which is covered by checklist item 1. III. Executive Orders 12866 and 13563 Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory E:\FR\FM\28MRR1.SGM 28MRR1 18872 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is not a significant regulatory action and, therefore, was not subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. IV. Regulatory Flexibility Act A final regulatory flexibility analysis has been prepared consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., and is summarized as follows: This final rule amends the Defense Federal Acquisition Regulation Supplement (DFARS) to add a checklist for Department of Defense (DoD) contractors to complete under solicitations that require the submission of certified cost or pricing data and when the Contracting Officer chooses to use the provision. This rule supports DoD’s Better Buying Power initiatives. The objective of the rule is to ensure that offerors submit thorough, accurate, and complete proposals. Through filling out the checklist the contractor will be able to self validate their proposals. No significant issues were raised by the public in response to the initial regulatory flexibility analysis. No comments were filed by the Chief Counsel for Advocacy of the Small Business Administration in response to the rule. The rule will apply to solicitations, for which certified cost or pricing data are required. Based on data collected in the Federal Procurement Data System for FY2008—FY2010, there are on average 905 actions per year that met the criteria where the proposal adequacy checklist could be utilized; on average 421 of those actions were with small business concerns. No alternatives were determined; the proposal adequacy checklist was created directly from requirements already in the FAR. V. Paperwork Reduction Act The rule contains information collection requirements that require the approval of the Office of Management and Budget under the Paperwork Reduction Act (44 U.S.C chapter 35). However, these changes to the DFARS do not impose additional information collection requirements to the paperwork burden previously approved under OMB Control Number 9000–0013, entitled Cost or Pricing Data Exemption Information. List of Subjects in 48 CFR Part(s) 215 and 252 Government procurement. Kortnee Stewart, Editor, Defense Acquisition Regulations System. Therefore, DoD amends 48 CFR parts 215 and 252 as follows: ■ 1. The authority citation for parts 215 and 252 continues to read as follows: Authority: 41 U.S.C. 1303 and 48 CFR Chapter 1. PART 215—CONTRACTING BY NEGOTIATION 2. Section 215.408 is amended by adding new paragraph (6) to read as follows: ■ 215.408 Solicitation provisions and contract clauses. * * * * * (6) When the solicitation requires the submission of certified cost or pricing data, the contracting officer should include 252.215–7009, Proposal Adequacy Checklist, in the solicitation to facilitate submission of a thorough, accurate, and complete proposal. PART 252—SOLICITATION PROVISIONS AND CONTRACT CLAUSES 3. Add 252.215–7009 to read as follows: ■ 252.215–7009 checklist. Proposal adequacy As prescribed in 215.408(6), use the following provision: Proposal Adequacy Checklist (MAR 2013) The offeror shall complete the following checklist, providing location of requested information, or an explanation of why the requested information is not provided. In preparation of the offeror’s checklist, offerors may elect to have their prospective subcontractors use the same or similar checklist as appropriate. PROPOSAL ADEQUACY CHECKLIST References Proposal page No. Submission item GENERAL INSTRUCTIONS 1. FAR 15.408, Table 15–2, Section I Paragraph A .... 2. FAR 15.408, Table 15–2, Section I Paragraph A(7) srobinson on DSK4SPTVN1PROD with RULES 3. FAR 15.408, Table 15–2, Section I Paragraph A(8) 4. FAR 15.408, Table 15–2, Section I, Paragraph C(1) VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 PO 00000 Is there a properly completed first page of the proposal per FAR 15.408 Table 15–2 I.A or as specified in the solicitation? Does the proposal identify the need for Governmentfurnished material/tooling/test equipment? Include the accountable contract number and contracting officer contact information if known. Does the proposal identify and explain notifications of noncompliance with Cost Accounting Standards Board or Cost Accounting Standards (CAS); any proposal inconsistencies with your disclosed practices or applicable CAS; and inconsistencies with your established estimating and accounting principles and procedures? Does the proposal disclose any other known activity that could materially impact the costs? Frm 00078 Fmt 4700 Sfmt 4700 E:\FR\FM\28MRR1.SGM 28MRR1 If not provided EXPLAIN (may use continuation pages) Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations 18873 PROPOSAL ADEQUACY CHECKLIST—Continued Proposal page No. References Submission item FAR 2.101, ‘‘Cost or pricing data’’ ................................ This may include, but is not limited to, such factors as— (1) Vendor quotations; (2) Nonrecurring costs; (3) Information on changes in production methods and in production or purchasing volume; (4) Data supporting projections of business prospects and objectives and related operations costs; (5) Unit-cost trends such as those associated with labor efficiency; (6) Make-or-buy decisions; (7) Estimated resources to attain business goals; and (8) Information on management decisions that could have a significant bearing on costs. Is an Index of all certified cost or pricing data and information accompanying or identified in the proposal provided and appropriately referenced? Are there any exceptions to submission of certified cost or pricing data pursuant to FAR 15.403–1(b)? If so, is supporting documentation included in the proposal? (Note questions 18–20.) Does the proposal disclose the judgmental factors applied and the mathematical or other methods used in the estimate, including those used in projecting from known data? Does the proposal disclose the nature and amount of any contingencies included in the proposed price? Does the proposal explain the basis of all cost estimating relationships (labor hours or material) proposed on other than a discrete basis? Is there a summary of total cost by element of cost and are the elements of cost cross-referenced to the supporting cost or pricing data? (Breakdowns for each cost element must be consistent with your cost accounting system, including breakdown by year.) If more than one Contract Line Item Number (CLIN) or sub Contract Line Item Number (sub-CLIN) is proposed as required by the RFP, are there summary total amounts covering all line items for each element of cost and is it cross-referenced to the supporting cost or pricing data? Does the proposal identify any incurred costs for work performed before the submission of the proposal? Is there a Government forward pricing rate agreement (FPRA)? If so, the offeror shall identify the official submittal of such rate and factor data. If not, does the proposal include all rates and factors by year that are utilized in the development of the proposal and the basis for those rates and factors? 5. FAR 15.408, Table 15–2, Section I Paragraph B .... 6. FAR 15.403–1(b) ...................................................... 7. FAR 15.408, Table 15–2, Section I Paragraph C(2)(i). 8. FAR 15.408, Table 15–2, Section I Paragraph C(2)(ii). 9. FAR 15.408 Table 15–2, Section II, Paragraph A or B. 10. FAR 15.408, Table 15–2, Section I Paragraphs D and E. 11. FAR 15.408, Table 15–2, Section I Paragraphs D and E. 12. FAR 15.408, Table 15–2, Section I Paragraph F ... 13. FAR 15.408, Table 15–2, Section I Paragraph G .. COST ELEMENTS MATERIALS AND SERVICES srobinson on DSK4SPTVN1PROD with RULES 14. FAR 15.408, Table 15–2, Section II Paragraph A VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 PO 00000 Does the proposal include a consolidated summary of individual material and services, frequently referred to as a Consolidated Bill of Material (CBOM), to include the basis for pricing? The offeror’s consolidated summary shall include raw materials, parts, components, assemblies, subcontracts and services to be produced or performed by others, identifying as a minimum the item, source, quantity, and price. Frm 00079 Fmt 4700 Sfmt 4700 E:\FR\FM\28MRR1.SGM 28MRR1 If not provided EXPLAIN (may use continuation pages) 18874 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations PROPOSAL ADEQUACY CHECKLIST—Continued References Proposal page No. Submission item SUBCONTRACTS (Purchased materials or services) 15. DFARS 215.404–3 .................................................. 16. FAR 15.404–3(c) ..................................................... FAR 52.244–2 17. FAR 15.408, Table 15–2, Note 1; Section II Paragraph A. Has the offeror identified in the proposal those subcontractor proposals, for which the contracting officer has initiated or may need to request field pricing analysis? Per the thresholds of FAR 15.404–3(c), Subcontract Pricing Considerations, does the proposal include a copy of the applicable subcontractor’s certified cost or pricing data? Is there a price/cost analysis establishing the reasonableness of each of the proposed subcontracts included with the proposal? If the offeror’s price/cost analyses are not provided with the proposal, does the proposal include a matrix identifying dates for receipt of subcontractor proposal, completion of fact finding for purposes of price/cost analysis, and submission of the price/cost analysis? EXCEPTIONS TO CERTIFIED COST OR PRICING DATA 18. FAR 52.215–20 ....................................................... FAR 2.101, ‘‘commercial item’’ 19. FAR 15.408, Table 15–2, Section II Paragraph A 20. FAR 15.408, Table 15–2, Section II Paragraph A(1). Has the offeror submitted an exception to the submission of certified cost or pricing data for commercial items proposed either at the prime or subcontractor level, in accordance with provision 52.215–20? a. Has the offeror specifically identified the type of commercial item claim (FAR 2.101 commercial item definition, paragraphs (1) through (8)), and the basis on which the item meets the definition? b. For modified commercial items (FAR 2.101 commercial item definition paragraph (3)); did the offeror classify the modification(s) as either— i. A modification of a type customarily available in the commercial marketplace (paragraph (3)(i)); or ii. A minor modification (paragraph (3)(ii)) of a type not customarily available in the commercial marketplace made to meet Federal Government requirements not exceeding the thresholds in FAR 15.403– 1(c)(3)(iii)(B)? c. For proposed commercial items ‘‘of a type’’, or ‘‘evolved’’ or modified (FAR 2.101 commercial item definition paragraphs (1) through (3)), did the contractor provide a technical description of the differences between the proposed item and the comparison item(s)? Does the proposal include a price analysis for all commercial items offered that are not available to the general public? Does the proposal support the degree of competition and the basis for establishing the source and reasonableness of price for each subcontract or purchase order priced on a competitive basis exceeding the threshold for certified cost or pricing data? INTERORGANIZATIONAL TRANSFERS srobinson on DSK4SPTVN1PROD with RULES 21. FAR 15.408, Table 15–2, Section II Paragraph A.(2). 22. FAR 15.408, Table 15–2, Section II Paragraph A(1). VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 PO 00000 For inter-organizational transfers proposed at cost, does the proposal include a complete cost proposal in compliance with Table 15–2? For inter-organizational transfers proposed at price in accordance with FAR 31.205–26(e), does the proposal provide an analysis by the prime that supports the exception from certified cost or pricing data in accordance with FAR 15.403–1? Frm 00080 Fmt 4700 Sfmt 4700 E:\FR\FM\28MRR1.SGM 28MRR1 If not provided EXPLAIN (may use continuation pages) Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations 18875 PROPOSAL ADEQUACY CHECKLIST—Continued References Proposal page No. Submission item DIRECT LABOR 23. FAR 15.408, Table 15–2, Section II Paragraph B 24. FAR 15.408, Table 15–2, Section II Paragraph B 25. FAR subpart 22.10 .................................................. Does the proposal include a time phased (i.e.; monthly, quarterly) breakdown of labor hours, rates and costs by category or skill level? If labor is the allocation base for indirect costs, the labor cost must be summarized in order that the applicable overhead rate can be applied. For labor Basis of Estimates (BOEs), does the proposal include labor categories, labor hours, and task descriptions—(e.g.; Statement of Work reference, applicable CLIN, Work Breakdown Structure, rationale for estimate, applicable history, and time-phasing)? If covered by the Service Contract Labor Standards statute (41 U.S.C. chapter 67), are the rates in the proposal in compliance with the minimum rates specified in the statute? INDIRECT COSTS 26. FAR 15.408, Table 15–2, Section II Paragraph C Does the proposal indicate the basis of estimate for proposed indirect costs and how they are applied? (Support for the indirect rates could consist of cost breakdowns, trends, and budgetary data.) OTHER COSTS 27. FAR 15.408, Table 15–2, Section II Paragraph D 28. FAR 15.408, Table 15–2, Section II Paragraph E 29. FAR 15.408, Table 15–2, Section II Paragraph F .. Does the proposal include other direct costs and the basis for pricing? If travel is included does the proposal include number of trips, number of people, number of days per trip, locations, and rates (e.g. airfare, per diem, hotel, car rental, etc)? If royalties exceed $1,500 does the proposal provide the information/data identified by Table 15–2? When facilities capital cost of money is proposed, does the proposal include submission of Form CASB–CMF or reference to an FPRA/FPRP and show the calculation of the proposed amount? FORMATS FOR SUBMISSION OF LINE ITEM SUMMARIES 30. FAR 15.408, Table 15–2, Section III ...................... 31. FAR 15.408, Table 15–2, Section III Paragraph B 32. FAR 15.408, Table 15–2, Section III Paragraph C Are all cost element breakdowns provided using the applicable format prescribed in FAR 15.408, Table 15–2 III? (or alternative format if specified in the request for proposal) If the proposal is for a modification or change order, have cost of work deleted (credits) and cost of work added (debits) been provided in the format described in FAR 15.408, Table 15–2.III.B? For price revisions/redeterminations, does the proposal follow the format in FAR 15.408, Table 15– 2.III.C? OTHER srobinson on DSK4SPTVN1PROD with RULES 33. FAR 16.4 ................................................................. 34. FAR 16.203–4 and FAR 15.408 Table 15–2, Section II, Paragraphs A, B, C, and D. 35. FAR 52.232–28 ....................................................... VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 PO 00000 If an incentive contract type, does the proposal include offeror proposed target cost, target profit or fee, share ratio, and, when applicable, minimum/ maximum fee, ceiling price? If Economic Price Adjustments are being proposed, does the proposal show the rationale and application for the economic price adjustment? If the offeror is proposing Performance-Based Payments—did the offeror comply with FAR 52.232– 28? Frm 00081 Fmt 4700 Sfmt 4700 E:\FR\FM\28MRR1.SGM 28MRR1 If not provided EXPLAIN (may use continuation pages) 18876 Federal Register / Vol. 78, No. 60 / Thursday, March 28, 2013 / Rules and Regulations PROPOSAL ADEQUACY CHECKLIST—Continued Proposal page No. References Submission item 36. FAR 15.408(n) ........................................................ FAR 52.215–22 FAR 52.215–23 Excessive Pass-through Charges—Identification of Subcontract Effort: If the offeror intends to subcontract more than 70% of the total cost of work to be performed, does the proposal identify: (i) the amount of the offeror’s indirect costs and profit applicable to the work to be performed by the proposed subcontractor(s); and (ii) a description of the added value provided by the offeror as related to the work to be performed by the proposed subcontractor(s)? (End of provision) [FR Doc. 2013–07106 Filed 3–27–13; 8:45 am] BILLING CODE 5001–06–P DEPARTMENT OF DEFENSE Defense Acquisition Regulations System 48 CFR Parts 225 and 252 RIN 0750–AH69 Defense Federal Acquisition Regulation Supplement: United StatesKorea Free Trade Agreement (DFARS Case 2012–D025) Defense Acquisition Regulations System, Department of Defense (DoD). ACTION: Final rule. AGENCY: SUMMARY: DoD has adopted as final, without change, an interim rule amending the Defense Federal Acquisition Regulation Supplement (DFARS) to implement the United States-Korea Free Trade Agreement. The Republic of Korea is already party to the World Trade Organization Government Procurement Agreement. DATES: Effective date: March 28, 2013. FOR FURTHER INFORMATION CONTACT: Ms. Amy Williams, telephone: 571–372– 6106. SUPPLEMENTARY INFORMATION: I. Background srobinson on DSK4SPTVN1PROD with RULES If not provided EXPLAIN (may use continuation pages) DoD published an interim rule in the Federal Register at 77 FR 30356 on May 22, 2012, to implement the United States-Korea Free Trade Agreement (see the United States-Korea Free Trade Agreement Implementation Act (Pub. L. 112–41) (19 U.S.C. 3805 note)). There were no public comments submitted in response to the interim rule. VerDate Mar<15>2010 17:43 Mar 27, 2013 Jkt 229001 II. Executive Orders 12866 and 13563 Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess all costs and benefits of available regulatory alternatives and, if regulation is necessary, to select regulatory approaches that maximize net benefits (including potential economic, environmental, public health and safety effects, distributive impacts, and equity). E.O. 13563 emphasizes the importance of quantifying both costs and benefits, of reducing costs, of harmonizing rules, and of promoting flexibility. This is a significant regulatory action and, therefore, was subject to review under section 6(b) of E.O. 12866, Regulatory Planning and Review, dated September 30, 1993. This rule is not a major rule under 5 U.S.C. 804. III. 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, 5 U.S.C. 601, et seq. Korea is already a designated country under the World Trade Organization (WTO) Agreement on Government Procurement (GPA). Although the rule now opens up Government procurement to the goods and services of Korea at or above the threshold of $100,000, DoD does not anticipate any significant economic impact on U.S. small businesses. DoD only applies the trade agreements to the non-defense items listed at DFARS 225.401–70, and acquisitions that are set aside or provide other forms of preference for small businesses are exempt. FAR 19.502–2 states that acquisitions that do not exceed $150,000 (except as described in paragraph (1) of the definition of ‘‘simplified acquisition threshold’’ at FAR 2.101) are automatically reserved exclusively for small business concerns, unless the contracting officer PO 00000 Frm 00082 Fmt 4700 Sfmt 9990 determines that there is not a reasonable expectation of obtaining offers from two or more responsible small business concerns. IV. Paperwork Reduction Act This rule affects the certification and information collection requirements in the provision at DFARS 252.225–7035, currently approved under OMB Control Number 0704–0229, titled Defense Federal Acquisition Regulation Supplement part 225, Foreign Acquisition, and related clauses, in accordance with the Paperwork Reduction Act (44 U.S.C. chapter 35). OMB Control Number 0704–0229 assessed the total burden related to part 225 at approximately 57,230 hours. The impact of this rule, however, is negligible, because it is just a question of under which category offered goods from the Republic of Korea would be listed. The rule also affects DFARS 252.225–7018, which is a variant of the Buy American-trade agreements certifications already approved, which was issued as an interim rule under DFARS Case 2011–D046 (76 FR 78858, December 20, 2011). List of Subjects in 48 CFR Parts 225 and 252 Government procurement. Kortnee Stewart, Editor, Defense Acquisition Regulations System. Interim Rule Adopted as Final Without Change Accordingly, the interim rule amending 48 CFR parts 225 and 252, which was published at 77 FR 30356 on May 22, 2012, is adopted as a final rule without change. [FR Doc. 2013–07131 Filed 3–27–13; 8:45 am] BILLING CODE 5001–06–P E:\FR\FM\28MRR1.SGM 28MRR1

Agencies

[Federal Register Volume 78, Number 60 (Thursday, March 28, 2013)]
[Rules and Regulations]
[Pages 18865-18876]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-07106]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System

48 CFR Parts 215 and 252

RIN 0750-AH47


Defense Federal Acquisition Regulation Supplement: Proposal 
Adequacy Checklist (DFARS Case 2011-D042)

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Final rule.

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

SUMMARY: DoD is issuing a final rule amending the Defense Federal 
Acquisition Regulation Supplement (DFARS) to incorporate a proposal 
adequacy checklist for proposals in response to solicitations that 
require submission of certified cost or pricing data.

DATES: Effective Date: March 28, 2013

FOR FURTHER INFORMATION CONTACT: Mr. Dustin Pitsch, telephone 571-372-
6090.

SUPPLEMENTARY INFORMATION: 

I. Background

    DoD published a proposed rule in the Federal Register at 76 FR 
75512 on December 2, 2011, to incorporate the requirement for a 
proposal adequacy checklist into DFARS 215.408, and an associated 
solicitation provision at 252.215-7009, to ensure offerors take 
responsibility for submitting thorough, accurate, and complete 
proposals. Fifteen respondents submitted public comments in response to 
the proposed rule.

II. Discussion and Analysis of the Public Comments

    DoD reviewed the public comments in the development of the final 
rule. A discussion of the comments and the changes made to the rule as 
a result of those comments is provided, as follows:
    A. Summary of significant changes from the proposed rule.
     The sentence ``Completion of this checklist in no way 
reduces the responsibility to fully comply with all of the requirements 
of 41 U.S.C. chapter 35, Truthful Cost or Pricing Data, and any other 
special requirements of the solicitation.'' is removed from the 
checklist instructions at DFARS 252.215-7009.
     The sentence ``In preparation of the offeror's checklist, 
offerors may elect to have their prospective subcontractors use the 
same or similar checklist as appropriate.'' was added to the end of

[[Page 18866]]

the checklist instructions at DFARS 252.215-7009. The following 
checklist items are referred to by their proposed rule numbering 
scheme:
     Checklist item 2 is modified to change the word 
``lending'' to ``accountable''.
     Checklist item 3 is modified to read ``Does the proposal 
identify and explain notifications of noncompliance with CASB or CAS; 
any proposal inconsistencies with your disclosed practices or 
applicable CAS; and inconsistencies with your established estimating 
and accounting principles and procedures?''
     Checklist item 4 is modified to read ``Does the proposal 
disclose any other known activity that could materially impact the 
costs?'' and now includes the list of eight sample factors that appear 
in the definition of ``cost or pricing data'' at FAR 2.101. The 
reference column is updated to add FAR 2.101, ``Cost or pricing data''.
     Checklist item 9 is revised in response to public comments 
to provide a different reference.
     Checklist item 10 has added the phrase ``including 
breakdown by year'' after ``consistent with your cost accounting 
system''.
     Checklist items 11 and 13 are removed in response to 
public comments and are covered by final rule item 10, as revised.
     Checklist item 14 is removed in response to public 
comments and final rule checklist item 4 was modified to include that 
non-recurring costs should be noted in the proposal along with other 
known activity that could materially impact costs.
     Checklist item 16 (final rule item 13) is modified to read 
``Is there a Government forward pricing rate agreement (FPRA)? If so, 
the offeror shall identify the official submittal of such rate and 
factor data.'' Checklist item 33 from the proposed rule, has been 
revised and combined with final rule item 13, to address the proposal 
requirements if there is no FPRA.
     Checklist item 17 is removed in response to public 
comments.
     Checklist item 18 (final rule item 14) is modified to note 
that a consolidated summary of individual material and services is 
``frequently referred to as a Consolidated Bill of Materials (CBOM)''.
     Checklist item 19 (final rule item 15) is modified to read 
``Has the offeror identified in the proposal those subcontractor 
proposals, for which the contracting officer has initiated or may need 
to request field pricing analysis?'' and to add the reference ``DFARS 
215.404-3.''
     Checklist item 20 (final rule item 16) is modified to 
remove ``proposal(s)'' and add ``certified cost or pricing data''.
     Checklist item 21 (final rule item 17) is combined with 
checklist item 22 and modified to read ``Is there a Price/Cost Analysis 
establishing the reasonableness of each of the proposed subcontracts 
included with the proposal? If the offeror's price/cost analyses are 
not provided with the proposal, does the proposal include a matrix 
identifying dates for receipt of subcontractor proposal, completion of 
fact finding for purposes of price/cost analysis, and submission of the 
price/cost analysis?''
     The sections of the checklist titled ``COMMERCIAL ITEM 
DETERMINATION'' and ``ADEQUATE PRICE COMPETITION'' are now titled 
``EXCEPTIONS TO CERTIFIED COST OR PRICING DATA.''
     Checklist item 23 (final rule item 18) is modified to read 
``Has the Offeror submitted any exceptions to the submission of 
certified cost or pricing data for commercial items proposed either at 
the prime or subcontractor level, in accordance with provision 52.215-
20?'' and now contains a list of the questions from items 24 through 
26. The reference column is updated to read ``FAR 52.215-20'' And ``FAR 
2.101, commercial item.''
     Checklist item 27 (final rule item 19) is modified to read 
``Does the proposal include a price analysis for all commercial items 
offered that are not available to the general public?''
     Checklist item 32 (final rule item 24) is modified to read 
``For labor Basis of Estimates, does the proposal include labor 
categories, labor hours, and task descriptions, (e.g.; Statement of 
Work reference, applicable CLIN, Work Breakdown Structure, rationale 
for estimate, applicable history, and time-phasing)?''
     Checklist item 33 is removed and relocated within final 
rule item 13 in response to public comments.
     Checklist item 35 (final rule item 26) is modified to add 
``and how they are applied.''
     Checklist item 43 is removed in response to public 
comments.
     Checklist item 44 (final rule 34) is revised in response 
to public comments to provide a different reference in the reference 
column and to address all types of economic price adjustments, not just 
those based on indices.
     Checklist item 45 (final rule item 35) is modified to read 
``If the offeror is proposing Performance-Based Payments did the 
offeror comply with FAR clause 52.232-28?'' and the reference is 
updated to read ``FAR 52.232-28.''
     Checklist item 47 is removed in response to public 
comments.

B. Analysis of Public Comments.

1. Increased Cost
    Comment: Two respondents stated that this new rule would result in 
increased costs that will ultimately be passed on to the Government and 
may be financially prohibitive to seeking other business.
    Response: This provision results from a long history of incomplete 
proposals resulting in rework and lost time, and it aims to achieve 
cost savings by improving initial proposal submissions from 
contractors.
2. Improved Efficiency
    Comment: One respondent noted that the checklist will improve 
efficiency on both sides of the contract and that DOD will save time 
because they will have all the answers they need to determine which 
contractor is best for the Government.
    Response: This comment accurately expresses the goals of this rule.
3. Paperwork Reduction Act
    Comment: Several respondents believed that this checklist imposes 
additional reporting requirements on the contractor and note that many 
of the checklist items are not currently required for submission of 
certified cost or pricing data. One respondent noted that while this 
checklist adds the new requirements it appears to add no value to the 
contracting process.
    Response: This rule does not impose additional requirements over 
what is already required under the conditions where certified cost or 
pricing data are required and these requirements are already covered by 
OMB Control Number 9000-0013. This provision is applicable to 
solicitations with an estimated value greater than the TINA threshold 
and that require certified cost or pricing data. This provision intends 
to increase uniformity across DoD, minimize local variations, and 
thereby decrease proposal preparation costs.
 4. Unnecessary and Duplicative
    Comment: Several respondents suggested that the checklist is 
unnecessary and duplicative. One respondent noted that it is the 
offeror's responsibility to comply with the requirements of the 
solicitation and an offeror that is unable to submit a compliant 
proposal is likely to be noncompliant after award. The same respondent 
noted that this checklist is somewhat duplicative of the DCAA forward 
pricing adequacy checklist. Another noted that most of the checklist

[[Page 18867]]

items already appear in FAR 15.408 at table 15-2 and suggested that the 
rule should require contractors confirm that their proposal complies 
with all applicable requirements of 15-2. Another respondent noted that 
this rule is: (1) Not compliant with Executive Order 12866 as there is 
no defined problem that this rule aims to solve; (2) the rule is 
inconsistent, incompatible and duplicative of what is already in Table 
15-2; and (3) that this checklist only adds a layer of regulatory 
requirements.
    Response: This provision is a single, uniform tool that is 
applicable across DoD to address the inconsistent interpretations of 
Table 15-2. The intent of this provision is to increase uniformity 
across DoD, minimize local variations, and thereby decrease proposal 
preparation costs. The checklist created by this rule is a DFARS 
provision; any checklist that DCAA currently uses is outside the scope 
of this rule.
5. Belongs in Procedures, Guidance, and Information (PGI)
    Comment: Several of the respondents suggested that this checklist 
should be incorporated into the DFARS PGI as it seems that it is 
intended to be a tool for assisting contracting officers in determining 
the adequacy of proposal and not a regulatory requirement.
    Response: This provision impacts contractors; therefore it must be 
in the DFARS. Language added to the DFARS PGI cannot have any effect on 
the public and exists to assist contracting officers.
6. Better Buying Power (BBP)
    Comment: Several respondents stated that the proposed rule does not 
support the BBP Initiative and noted that the rule does not align with 
any of the 23 principal actions. The respondents believed that the 
proposed rule is contrary to the BBP Initiative to reduce nonproductive 
processes and bureaucracy.
    Response: While this initiative predates BBP, it is consistent with 
the BBP's cost reduction initiatives.
7. Self validation
    Comment: Several comments were received regarding the possibility 
of contractors self validating their proposal through the use of the 
checklist. The respondents noted that: (1) The contractor has always 
been responsible for meeting the requirements of the solicitation; (2) 
use of the checklist will not relieve the contracting officers of the 
responsibility of determining the proposal adequate; and (3) it is 
likely that time and resources will be wasted reviewing the checklist 
instead of reviewing the proposal.
    Response: This provision should result in cost savings by improving 
initial proposal submissions from offerors and reduce the amount of 
rework and resubmissions. Because the offeror will specify where to 
find required information in its proposal, this provision aims to 
achieve time savings for contracting officers.
8. Protest potential
    Comment: One respondent suggested that this rule creates additional 
potential for protests as acceptance of the checklist or the non-
rejection of the checklist would allow contractors to claim they have 
met all solicitation requirements and were unfairly denied award.
    Response: This checklist is intended to facilitate the contractor 
submitting an adequate proposal. The checklist is not intended to be a 
standalone decision document; it will be used by contracting officials 
in reviewing proposals when certified cost or pricing data are 
required.
9. Require Checklist (Shall/Should)
    Comment: One respondent suggested changing the clause prescription 
at 215.408(3) to read that the contracting officer ``shall'' use the 
checklist instead of ``should'' as is used in the proposed rule. This 
respondent believed that nonstandard mandatory use of the checklist 
will cause confusion across the DoD and industry.
    Response: Because of the wide variance in requirements, the 
contracting officer will have discretion to determine applicability to 
the requirements.
10. Corrective Actions
    Comment: Two respondents suggested that there should be penalties 
associated with non-submission of the checklist.
    Response: The checklist is intended to be a tool to assist 
contractors to provide adequate, compliant proposals; it is not meant 
to be punitive. Non-receipt of the checklist may result in extending 
the proposal evaluation and delaying contract award.
11. Contracting Officer Determination
    Comment: One respondent suggested that the contracting officer 
should specify which items on the checklist will be required and where 
data other than certified cost or pricing data are required.
    Response: This provision is to be included only in solicitations 
requiring certified cost or pricing data.
12. Tailoring
    Comment: One respondent suggested that the contracting officer 
should be able to tailor the checklist as necessary to each 
acquisition.
    Response: The solicitation provision will be utilized in its 
entirety. This is a tool for offerors to improve the initial proposal 
submission, ensuring adequacy and completeness.
13. Subcontractor Flowdown
    Comment: Several comments were received regarding the applicability 
of the checklist to subcontractors as the proposed rule has no guidance 
on this. One of the respondents noted that flowdown to require 
subcontractor to use the checklist would add a significant amount of 
time to proposal preparation.
    Response: The checklist is not required to flow down to 
subcontractors, but prime contractors may elect to use it for their 
prospective subcontractors' proposals.
14. Solicitation Process Changes
    Comment: One respondent made several suggestions toward the overall 
solicitation process including: (1) Not allowing proposal costs to be 
billed directly if the proposal is inadequate; (2) requiring 
contractors to justify their proposed fee with a risk analysis; (3) 
requiring, for all proposal modifications, a total proposal 
resubmission; (4) requiring more detail in contractor's analysis of 
subcontractor proposals; and (5) creating a requirement that postaward 
subcontractor cost savings should be passed on to the Government.
    Response: These comments are beyond the scope of this rule.
15. Section L
    Comment: One respondent stated that many of the checklist items are 
already called out in section L of the solicitation and suggested that 
section L could be modified to reflect the pertinent items in the 
checklist.
    Response: The solicitation provision created by this rule will go 
in section L of the solicitation, and it is meant to supplement the 
other instructions for circumstances where certified cost or pricing 
data will be required.
16. Remove ``compliance'' Statement
    Comment: One respondent suggested removing the ``compliance'' 
statement directly preceding the checklist at clause 252.215-7009.
    Response: The provision is modified to remove ``Completion of this 
checklist in no way reduces the responsibility to fully comply with all 
of the requirements of 41 U.S.C. chapter 35,

[[Page 18868]]

Truthful Cost or Pricing Data, and any other special requirements of 
the solicitation.''
17. Indefinite-Delivery Indefinite-Quantity (IDIQ) Applicability
    Comment: One respondent stated that the checklist is not 
appropriate for IDIQ solicitations and awards. The respondent stated 
that this is because IDIQs often provide a placeholder value or a 
predetermined bill of material that the offeror must use, but the 
checklist implies that the offeror is responsible for all of the TINA 
requirements for a value in the proposal that has been directed by the 
Government.
    Response: This checklist is applicable to solicitations that 
require certified price and costing data. When a predetermined bill of 
materials is provided by the Government, certified cost or price data 
is not required for that cost element.
18. Certified Bill of Materials (CBOM)
    Comment: One respondent stated that the Government's requirement 
for a CBOM is not always consistently interpreted or applied which, at 
times, has resulted in unnecessary costs to the Government in the name 
of compliance. The checklist should encourage contractors to discuss 
BOM requirements with the contracting officer prior to preparing the 
proposal where a single CBOM (in an electronic format) is not 
consistent with the contractor's current (and approved) practices. 
Further, the contracting officer should be allowed the reasonable 
discretion to decide what information or format is truly necessary for 
determining a price fair and reasonable.
    Response: The rule does not restrict communication among the 
parties. Specific submission requirements can be included in section L 
of the solicitation at the contracting officer's discretion.
19. Contractor Versus Offeror
    Comment: One respondent stated that the terms ``Offeror'' and 
``contractor'' should be used consistently and not interchangeably to 
minimize confusion.
    Response: All ``contractor'' references have been changed to 
``offeror'' in the DFARS text and provision.
20. CAGE and DUNS
    Comment: One respondent suggested that proposals include both the 
CAGE and DUNS numbers of the offeror in order to more effectively 
monitor offeror compliance with forward pricing rate recommendations 
and forward pricing rate agreements.
    Response: This is outside the scope of this rule; it is already 
required by the solicitation.
21. Proposal Requirements
    Comment: One respondent requested adding a question in the 
``General Instructions'' to assess whether the offeror addressed the 
specific requirements of the contracting officer within the proposal.
    Response: This checklist addresses proposals that will require 
certified cost or pricing data. Specific submission requirements can be 
included in section L of the solicitation at the contracting officer's 
discretion.
 22. General Instructions
    Comment: One respondent suggested adding under ``General 
Instructions'' the following three items:
    a. Does the proposal comply with the RFP in regard to data rights?
    b. Does the proposal comply with the RFP regarding the applicable 
requirements relative to submission of subcontracting plan, Cost and 
Software Data Reporting (DFARS 252.234-7003, 252.234-7004), EVM, Unique 
Item Identification (UID) and specialty metals?''
    Response: This checklist applies only to the cost proposal and not 
the proposal in its entirety.
23. Column Heading
    Comment: One respondent requested changing the format of the 
checklist to include a ``Y/N/N/A'' column.
    Response: The checklist is designed to be open-ended. An 
explanation should be provided when ``not applicable.'' A column with 
``Y/N/N/A'' is not necessary. If the offeror fills in the checklist 
with a page number(s) in the ``Proposal Page No.'' column this would 
denote that ``yes'' the item has been provided. If the contractor 
enters something in the ``If not provided EXPLAIN'' column, this would 
denote that the item has not been provided and there should be an 
explanation as to why the item has not been provided. The item not 
being applicable for the particular proposal can be included with the 
explanation as to why it has not been provided.
24. Checklist Item 1
    Comment: Two respondents recommended modifying the reference block 
for item 1 to accurately reflect the two items being referred to in FAR 
table 15-2.
    Response: The reference is changed to ``Paragraph A.''
 25. Checklist Item 2
    Comment: One respondent recommended the terminology in the 
checklist item for Government-furnished material/tooling/test equipment 
be made consistent with the FAR reference for Government property. 
Another respondent suggested requiring a cost impact study if 
Government-furnished property/material/tooling/test equipment is 
denied. One respondent requested replacing the term ``lending'' with 
``accountable'' in order to be consistent with the FAR.
    Response: The DFARS text is changed to replace the term ``lending'' 
with ``accountable''. A cost impact study is outside the scope of this 
rule.
26. Checklist Item 3
    Comment: One respondent suggested changing the checklist item to 
ask whether the offeror has been notified of any CAS noncompliance or 
other estimating deficiencies that may impact the proposed price. 
Another respondent recommended requiring the offeror to evaluate the 
magnitude of the impact of the CAS noncompliance or deficiency on 
estimated costs, describe the offeror's efforts to correct the 
noncompliance, and propose a method of dealing with the noncompliance 
in the negotiated agreement. One respondent stated that no FAR 
references or any other FAR or DFARS clauses currently require an 
offeror to disclose estimating deficiencies in a proposal and this 
checklist item would create a new requirement for an offeror.
    Response: This item is revised to read ``Does the proposal identify 
and explain notifications of noncompliance with CASD or CAS; any 
proposal inconsistencies with your disclosed practices or applicable 
CAS; and inconsistencies with our established estimating and accounting 
principles and procedures?'' to more closely align with table 15-2.
27. Checklist Item 4
    Comment: One respondent stated some of the terms in the checklist 
were newly created for the checklist and were not directly from the 
requirements already in the Federal Acquisition Regulation (FAR). The 
respondent suggested the inclusion of new terms would cause 
inconsistency that may lead to confusion. The FAR reference was also 
questioned.
    Response: This checklist item is modified to read ``Does the 
proposal disclose any other known activity that could materially impact 
the costs?'' and now includes the list of eight sample factors that 
appear in the definition of

[[Page 18869]]

``cost or pricing data'' at FAR 2.101. The reference column is updated 
to add FAR 2.101, ``cost or pricing data.''
28. Checklist Item 7
    Comment: Two respondents stated it would be wastefully time 
consuming and burdensome for offerors to disclose which pages of the 
proposal contain a judgmental factor applied and the mathematical or 
other methods used in the estimate. The respondents suggested a large 
percentage of the pages comprising the proposal would contain such 
information.
    Response: Having contractors identify this information prevents 
miscommunication and misunderstanding, and it will save time in the 
proposal evaluation process.
29. Checklist Item 9
    Comments: One respondent stated the FAR reference was not 
applicable because it pertains to CLINS instead of cost estimating 
relationships. One respondent suggested the checklist item should 
include an additional requirement that the offeror explain how the cost 
estimating relationship (CER) is applied.
    Response: This reference for the item has been change to cite 
Section II, Paragraphs A and B of Table 15-2. These references require 
the basis of estimate. CER is a basis of estimate that could be used 
when cost is not proposed on a discrete basis.
30. Checklist Item 10
    Comment: One respondent stated the FAR reference was not applicable 
because it pertains to CLINS instead of cost elements.
    Response: Paragraph D is referenced because it specifically 
requests offeror to provide cost element breakdown for each proposed 
line item. The checklist does not directly restate every item of table 
15-2 as it is meant to be used as a tool to ensure all necessary 
elements have been included with the proposal.
31. Checklist Item 11
    Comments: One respondent noted the FAR reference to paragraph D was 
not applicable. Another respondent commented the item would introduce a 
new requirement because paragraph D does not require a yearly breakdown 
by either total price or cost element.
    Response: This element is removed from the checklist as it is 
covered by final rule item 10; breakdowns for cost elements must be 
consistent with the cost accounting system.
 32. Checklist Item 13
    Comments: One respondent noted the FAR reference to paragraph E was 
not applicable. Another respondent commented the item would introduce a 
new requirement because paragraph D does not require a yearly breakdown 
by either total price or cost element.
    Response: This element is removed from the checklist as it is 
covered by final rule item 10; breakdowns for cost elements must be 
consistent with the cost accounting system.
 33. Checklist Item 14
    Comments: One respondent noted the FAR reference to paragraph E was 
not applicable. Another respondent commented the item would introduce a 
new requirement because the offeror currently does not have to 
segregate recurring and non-recurring costs at the CLIN/Sub-CLIN and 
total cost levels.
    Response: This checklist item is removed as non-recurring costs are 
cited in the definition of ``cost or pricing data'' at FAR 2.101 and 
should be noted in response to checklist item 4.
34. Checklist Item 17
    Comments: Several respondents stated the checklist item for a 
description of supplies and services addresses non-cost information and 
should be eliminated. The respondents commented that the checklist item 
would create a new reporting requirement for offerors because this is 
not currently a FAR or DFARS requirement.
    Response: Since item 17 requests non-cost information, it is 
removed from the final rule. The basis on which supplies or services 
meet the need of the Government should be developed within the 
proposal.
35. Checklist Item 18 (Final Rule Item 14)
    Comments: One respondent requested the language of the checklist 
item be expanded to inquire whether the offeror's estimating technique 
is appropriate and whether inter-organizational transfers are included 
in the Consolidated Bill of Materials. Several respondents suggested a 
requirement that an offeror provide an electronic version of the CBOM 
that can be sorted by supplier, category, quantity, unit price, 
extended price of parts number, and identification of commercial items. 
Another respondent imparted the rationale that was utilized to reach 
the final version of the Air Force Proposal Adequacy Checklist and 
cautioned expanding the scope for this checklist item.
    Response: The suggested items, as well as requiring an electronic 
submission that can be sorted, would be new reporting requirements 
beyond the intent of this rule. Specific submission requirements can be 
included in section L of the solicitation at the contracting officer's 
discretion. The checklist is not intended to dictate all specific 
requirements for every solicitation in which it is used.
36. Checklist Item 19 (Final Rule Item 15)
    Comments: Several respondents suggested additional language to 
inform offerors that they must still perform price and cost analysis 
when an assist audit has been requested on a subcontractor. One 
respondent suggested the checklist item be modified or eliminated 
because contracting officers and DCAA, not prime contractors have the 
authority to request assist audits of subcontractors. Another 
respondent requested amending the checklist item to direct the offeror 
to inform the contracting officer as soon as possible of the need for 
an assist audit resulting from proprietary data rights assertions.
    Response: A reference for item 19 is added to reflect ``DFARS 
215.404-3'' and the checklist item is modified to read ``Has the 
offeror identified in the proposal those subcontractor proposals, for 
which the contracting officer has initiated or may need to request 
field pricing analysis?''
37. Checklist Item 20 (Final Rule Item 16)
    Comments: One respondent proposed the FAR reference be revised to 
match that of item 18. Two respondents suggested modifying the 
language. One suggested: ``Per the thresholds of FAR 15.404-3(c), 
Subcontract Pricing Considerations, does the proposal include either a 
copy of the applicable subcontractor's proposals or the date by which 
these proposals will be submitted directly from the subcontractor? If 
proposals are to be submitted, annotate the projected date provided of 
submission in `explanation' column of this checklist.'' The other 
respondent suggested modifying the language to read: ``* * * does the 
proposal include a copy of the applicable subcontractor's certified 
cost or pricing data?''
    Response: The item reference is revised to add ``FAR 52.244-2''. 
The submission item text will be modified to incorporate the second 
respondent's suggestion of ``* * * does the proposal include a copy of 
the applicable subcontractor's certified cost or pricing data?'' If the 
answer is ``no,'' the explanation should state how and when the data 
will be provided.

[[Page 18870]]

 38. Checklist Item 21 (Final Rule Item 17)
    Comments: One respondent noted the language in checklist items 21 
and 22 should be consistent when addressing an offeror's price/cost 
analysis of subcontracts. One respondent suggested the checklist item 
question be modified to ask whether a prime contractor's price/cost 
analysis of each proposed subcontract greater than $700,000 is included 
in the proposal.
    Response: Item 21 is modified to read ``Is there a price/cost 
analysis establishing the reasonableness of each of the proposed 
subcontracts included with the proposal?'' A price or cost analysis 
must be accomplished on all subcontractor proposals; there is no dollar 
threshold for this.
39. Checklist Item 22 (Final Rule Item 17)
    Comments: One respondent stated the checklist item would create a 
new reporting requirement for offerors because this is not currently a 
FAR or DFARS clause that requires an offeror to provide a matrix of 
anticipated dates for the receipt of proposals from subcontractors. 
Other respondents recommended identifying the offeror as a prime 
contractor and using the language consistently when addressing an 
offeror's price/cost analysis of subcontracts.
    Response: This is only necessary if a proposal is incomplete 
because the information in the preceding checklist item has not been 
submitted. The checklist is not generating a new reporting requirement; 
it is only requesting remaining proposal components submission date for 
adequacy. This item has been combined with the previous checklist item 
(item 21 which is item 16 in the final rule) to clarify that it is a 
follow-up that is only necessary when an analysis has not yet been 
submitted for each subcontract.
40. Checklist Item 23 (Final Rule Item 18)
    Comments: One respondent commented the item would introduce a new 
requirement because it is not currently mandatory for the offeror to 
indicate whether commercial items would be exempt for certified cost or 
pricing data requirements. The respondent noted a contracting officer 
may require data other than certified cost or pricing data when a 
commercial item is being acquired. Another respondent suggested the 
offeror provide the rationale for commercial items listed as exempt 
from certified cost or pricing data requirements.
    Response: This is not a new reporting requirement as this item 
allows the offeror to acknowledge an allowable exemption to the 
requirement for certified cost or pricing data at the prime or 
subcontractor level. The item is modified to read ``Has the Offeror 
submitted any exceptions to the submission of certified cost or pricing 
data for commercial items proposed either at the prime or subcontractor 
level, in accordance with provision 52.215-20?'' and now contains a 
bulleted list of the questions from items 24 through 26. The reference 
column is updated to read ``FAR 52.215-20'' and ``FAR 2.101, commercial 
item.''
41. Checklist Item 24
    Comments: One respondent noted the FAR reference only points to the 
definition of a commercial item and does not reference a FAR 
instruction for an offeror to provide a technical description of the 
differences between the proposed item and the comparison item.
    Response: This item is removed because the requirements at 52.215-
20 are consolidated in checklist item 23 (final rule item 17) making 
this item redundant.
 42. Checklist Item 25
    Comments: One respondent commented the checklist item would create 
a new reporting requirement for offerors because the FAR currently 
states a contracting officer may require data other than certified cost 
or pricing data but does not require an offeror to provide such 
information for every proposal. Another respondent suggested including 
language that a minor modification must meet the definition in FAR 
2.101 in order to clarify the requirements of a commercial item 
exemption. One respondent requested the checklist item ask the offeror 
to justify, in addition to classifying, the modification. Several 
respondents requested the replacement of the phrase ``see note below'' 
with language that informs the offeror modifications that do not 
qualify as minor under FAR 2.101 or modifications that qualify as minor 
where the total price of all such modifications exceed the greater of 
the thresholds for certified cost or pricing data or 5% of the total 
price of the contract are not exempt from the submission of certified 
cost or pricing data.
    Response: This item is removed because the requirements at 52.215-
20 are consolidated in checklist item 23 (final rule item 18) making 
this item redundant.
 43. Checklist Item 26
    Comments: One respondent stated the checklist item only references 
the definition of a commercial item and would create a new reporting 
requirement for offerors because this is not currently a FAR or DFARS 
requirement for an offeror to provide a technical description of the 
differences between the proposed item and the comparison item.
    Response: This item is removed because the requirements at 52.215-
20 are consolidated in checklist item 23 (final rule item 18) making 
this item redundant.
44. Checklist Item 27 (Final Rule Item 19)
    Comments: Several respondents suggested additional requirements for 
the offeror to provide data other than certified cost or pricing data 
to support a determination of price reasonableness for commercial items 
such as data related competition, market prices, costs, etc. One 
respondent stated that the reference was incorrect because cost or 
pricing data are not required for commercial items and if such 
information were required, it creates a new reporting requirement for 
offerors because this is not currently a FAR or DFARS requirement for 
an offeror.
    Response: The contracting officer would have to decide during 
discussions if other than certified cost or pricing data will be 
necessary. This is not a new requirement; it is a reminder that a price 
analysis is still required when certified cost or pricing data are not 
required. The FAR reference is revised to reflect ``FAR 15.408, Table 
15-2, Section II Paragraph A'' and rephrased to address ``a price 
analysis for all commercial items offered that are not available to the 
general public.''
45. Checklist Item 30 (Final Rule Item 22)
    Comments: One respondent suggested amending the FAR reference for 
the requirement to provide analysis for inter-organizational transfers.
    Response: The table 15-2 reference is added to the references 
column in the final rule (Paragraph A(1) Section II Table 15-2).
46. Checklist Item 31 (Final Rule Item 23)
    Comments: One respondent noted the importance of well referenced 
information regarding the types, time phasing, and WBS for direct labor 
so that the cost element summary can be reconciled with the basis of 
estimates.

[[Page 18871]]

    Response: The checklist is intended to assist contractors in 
providing well referenced proposal information.
47. Checklist Item 32 (Final Rule Item 24)
    Comments: One respondent noted the checklist item would impose a 
new requirement on offerors since the FAR reference requires a time-
phased breakdown of labor hours, rates, and cost by appropriate 
category but does not require task descriptions, statement-of-work 
reference, applicable CLIN, work breakdown structure (WBS), rationale 
for estimate and other detailed breakdowns. Another responded 
reiterated the importance of well referenced information regarding the 
types, time phasing, and WBS for direct labor so that the cost element 
summary can be with reconciled with the basis of estimates.
    Response: The checklist item is modified to include the list of 
examples ``Statement of Work reference, applicable CLIN, work breakdown 
structure, rationale for estimate, applicable history, and time-
phasing'' in parentheses. Also, ``e.g.'' has been added at the 
beginning of this list to further denote that the items are merely 
examples.
48. Checklist Item 33 (Final Rule Item 13)
    Comments: One respondent recommended relocating the content of 
checklist item 33 into the ``General Instructions.'' Another respondent 
suggested a requirement that an offeror provide historical direct labor 
rates for proposed labor categories if a FPRA/FPRP is not available. 
Ifhistorical direct labor rates are also not available the respondent 
requests an offeror provide marketplace analysis for the proposed labor 
categories.
    Response: This item is relocated to the ``General Instructions'' 
section of the checklist and consolidated with item 16 (final rule item 
13).
49. Checklist Item 35 (Final Rule Item 26)
    Comments: Several respondents request including additional guidance 
in the checklist item so offerors more clearly explain how indirect 
rates are developed and applied throughout the proposal.
    Response: The rule text is modified to include ``and how they are 
applied?''
50. Checklist Item 36 (Final Rule Item 27)
    Comments: One respondent stated the language of the checklist item 
should be amended to distinguish when travel is proposed as a direct 
cost because it may not always be proposed as such and the question 
requirement would not be applicable. Another respondent stated the 
checklist item creates a new reporting requirement for offerors because 
this is no current FAR or DFARS requirement.
    Response: The travel details listed in item 36 are not spelled out 
in table 15-2; however they are the necessary details to provide an 
adequate basis for pricing of direct travel.
51. Checklist Item 40 (Final Rule Item 31)
    Comments: One respondent stated the checklist item duplicates the 
requirement listed in checklist item 39 which addresses cost element 
breakdowns of all types of proposals.
    Response: The tables are represented in separate checklist items to 
accentuate that they are each used in different circumstances.
52. Checklist Item 41 (Final Rule Item 32)
    Comments: One respondent stated the checklist item duplicates the 
requirement listed in checklist item 39 which addresses cost element 
breakdowns of all types of proposals.
    Response: The tables are represented in separate checklist items to 
accentuate that they are each used in different circumstances.
53. Checklist Item 43
    Comments: One respondent commented that the item would introduce a 
new requirement because the checklist item requires the offeror to 
state that the fee is in accordance with statutory requirements whereas 
the FAR reference identifies a requirement on the contracting officer 
to verify the fee does not exceed statutory requirements.
    Response: This item is removed because the contracting officer 
determines if the fee is appropriate in accordance with the 
regulations, not the offeror.
54. Checklist Item 44 (Final Rule Item 34)
    Comments: One respondent recommended the removal of item 44 in the 
checklist regarding the rationale and application of economic price 
adjustment in a proposal. The respondent noted the inclusion of the 
item on the checklist may encourage an offeror to propose the use of 
economic price adjustments, which would not be desirable to the 
Government because of the of the administrative burden. The respondent 
also stated the checklist item assumes an economic price adjustment 
with indices when indices are only one of the methods available. The 
FAR reference was also questioned.
    Response: This item is revised to address all type of economic 
incentive arrangements and a new reference has been provided to FAR 
16.203-4 and FAR 15.408 Table 15-2, Section II, Paragraphs A, B, C, and 
D.
55. Checklist Item 45 (Final Rule Item 35)
    Comments: One respondent suggested that the checklist item should 
clarify that an offeror can propose a separate price for performance 
based payments which are negotiated after award. Another respondent 
stated that the checklist item creates a new reporting requirement for 
offerors because there is no current FAR or DFARS requirement for an 
offeror to provide an expenditure profile.
    Response: The reference is modified to reflect FAR 52.232-28 and 
the item is modified to read as follows: ``If the offeror is proposing 
Performance-Based Payments, did the offeror comply with FAR 52.232-
28?'' The provision at FAR 52.232-28 is included in solicitations when 
offerors are invited to propose performance based payments and the 
provision includes all of the necessary information for submission.
56. Checklist Item 46 (Final Rule Item 36)
    Comments: One respondent suggested expanding checklist item 46 to 
require identification and explanation of any higher tier 
subcontractors rather than limiting the requirement to only 
subcontractors supplying the prime contractor. Another respondent 
recommended the FAR reference be amended to include FAR 52.215-22.
    Response: References to FAR clauses 52.215-22 and 52.215-23 are 
added. This checklist is addressed to the offeror and not to the 
subcontractors. When the prime is subcontracting more than 70% of the 
effort, the contractor is required to disclose this in the proposal.
57. Checklist Item 47
    Comments: One respondent commented the item would introduce a new 
requirement because the checklist item does not make reference to a 
current requirement within the FAR.
    Response: This item is removed as point of contact data is already 
required by table 15-2 Section I (A)(3), which is covered by checklist 
item 1.

III. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory

[[Page 18872]]

alternatives and, if regulation is necessary, to select regulatory 
approaches that maximize net benefits (including potential economic, 
environmental, public health and safety effects, distributive impacts, 
and equity). E.O. 13563 emphasizes the importance of quantifying both 
costs and benefits, of reducing costs, of harmonizing rules, and of 
promoting flexibility. This is not a significant regulatory action and, 
therefore, was not subject to review under section 6(b) of E.O. 12866, 
Regulatory Planning and Review, dated September 30, 1993. This rule is 
not a major rule under 5 U.S.C. 804.

IV. Regulatory Flexibility Act

    A final regulatory flexibility analysis has been prepared 
consistent with the Regulatory Flexibility Act, 5 U.S.C. 601, et seq., 
and is summarized as follows:
    This final rule amends the Defense Federal Acquisition Regulation 
Supplement (DFARS) to add a checklist for Department of Defense (DoD) 
contractors to complete under solicitations that require the submission 
of certified cost or pricing data and when the Contracting Officer 
chooses to use the provision. This rule supports DoD's Better Buying 
Power initiatives.
    The objective of the rule is to ensure that offerors submit 
thorough, accurate, and complete proposals. Through filling out the 
checklist the contractor will be able to self validate their proposals.
    No significant issues were raised by the public in response to the 
initial regulatory flexibility analysis.
    No comments were filed by the Chief Counsel for Advocacy of the 
Small Business Administration in response to the rule.
    The rule will apply to solicitations, for which certified cost or 
pricing data are required. Based on data collected in the Federal 
Procurement Data System for FY2008--FY2010, there are on average 905 
actions per year that met the criteria where the proposal adequacy 
checklist could be utilized; on average 421 of those actions were with 
small business concerns.
    No alternatives were determined; the proposal adequacy checklist 
was created directly from requirements already in the FAR.

V. Paperwork Reduction Act

    The rule contains information collection requirements that require 
the approval of the Office of Management and Budget under the Paperwork 
Reduction Act (44 U.S.C chapter 35). However, these changes to the 
DFARS do not impose additional information collection requirements to 
the paperwork burden previously approved under OMB Control Number 9000-
0013, entitled Cost or Pricing Data Exemption Information.

List of Subjects in 48 CFR Part(s) 215 and 252

    Government procurement.

Kortnee Stewart,
Editor, Defense Acquisition Regulations System.
    Therefore, DoD amends 48 CFR parts 215 and 252 as follows:

0
1. The authority citation for parts 215 and 252 continues to read as 
follows:

    Authority: 41 U.S.C. 1303 and 48 CFR Chapter 1.

PART 215--CONTRACTING BY NEGOTIATION

0
2. Section 215.408 is amended by adding new paragraph (6) to read as 
follows:


215.408  Solicitation provisions and contract clauses.

* * * * *
    (6) When the solicitation requires the submission of certified cost 
or pricing data, the contracting officer should include 252.215-7009, 
Proposal Adequacy Checklist, in the solicitation to facilitate 
submission of a thorough, accurate, and complete proposal.

PART 252--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
3. Add 252.215-7009 to read as follows:


252.215-7009  Proposal adequacy checklist.

    As prescribed in 215.408(6), use the following provision:

Proposal Adequacy Checklist (MAR 2013)

    The offeror shall complete the following checklist, providing 
location of requested information, or an explanation of why the 
requested information is not provided. In preparation of the offeror's 
checklist, offerors may elect to have their prospective subcontractors 
use the same or similar checklist as appropriate.

                                                               Proposal Adequacy Checklist
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                              Proposal    If not provided EXPLAIN  (may
                References                                          Submission item                           page No.       use  continuation pages)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                  GENERAL INSTRUCTIONS
--------------------------------------------------------------------------------------------------------------------------------------------------------
1. FAR 15.408, Table 15-2, Section I        Is there a properly completed first page of the proposal per
 Paragraph A.                                FAR 15.408 Table 15-2 I.A or as specified in the
                                             solicitation?
2. FAR 15.408, Table 15-2, Section I        Does the proposal identify the need for Government-furnished
 Paragraph A(7).                             material/tooling/test equipment? Include the accountable
                                             contract number and contracting officer contact information
                                             if known.
3. FAR 15.408, Table 15-2, Section I        Does the proposal identify and explain notifications of
 Paragraph A(8).                             noncompliance with Cost Accounting Standards Board or Cost
                                             Accounting Standards (CAS); any proposal inconsistencies with
                                             your disclosed practices or applicable CAS; and
                                             inconsistencies with your established estimating and
                                             accounting principles and procedures?
4. FAR 15.408, Table 15-2, Section I,       Does the proposal disclose any other known activity that could
 Paragraph C(1).                             materially impact the costs?

[[Page 18873]]

 
FAR 2.101, ``Cost or pricing data''.......  This may include, but is not limited to, such factors as--
                                            (1) Vendor quotations;
                                            (2) Nonrecurring costs;
                                            (3) Information on changes in production methods and in
                                             production or purchasing volume;
                                            (4) Data supporting projections of business prospects and
                                             objectives and related operations costs;
                                            (5) Unit-cost trends such as those associated with labor
                                             efficiency;
                                            (6) Make-or-buy decisions;
                                            (7) Estimated resources to attain business goals; and
                                            (8) Information on management decisions that could have a
                                             significant bearing on costs.
5. FAR 15.408, Table 15-2, Section I        Is an Index of all certified cost or pricing data and
 Paragraph B.                                information accompanying or identified in the proposal
                                             provided and appropriately referenced?
6. FAR 15.403-1(b)........................  Are there any exceptions to submission of certified cost or
                                             pricing data pursuant to FAR 15.403-1(b)? If so, is
                                             supporting documentation included in the proposal? (Note
                                             questions 18-20.)
7. FAR 15.408, Table 15-2, Section I        Does the proposal disclose the judgmental factors applied and
 Paragraph C(2)(i).                          the mathematical or other methods used in the estimate,
                                             including those used in projecting from known data?
8. FAR 15.408, Table 15-2, Section I        Does the proposal disclose the nature and amount of any
 Paragraph C(2)(ii).                         contingencies included in the proposed price?
9. FAR 15.408 Table 15-2, Section II,       Does the proposal explain the basis of all cost estimating
 Paragraph A or B.                           relationships (labor hours or material) proposed on other
                                             than a discrete basis?
10. FAR 15.408, Table 15-2, Section I       Is there a summary of total cost by element of cost and are
 Paragraphs D and E.                         the elements of cost cross-referenced to the supporting cost
                                             or pricing data? (Breakdowns for each cost element must be
                                             consistent with your cost accounting system, including
                                             breakdown by year.)
11. FAR 15.408, Table 15-2, Section I       If more than one Contract Line Item Number (CLIN) or sub
 Paragraphs D and E.                         Contract Line Item Number (sub-CLIN) is proposed as required
                                             by the RFP, are there summary total amounts covering all line
                                             items for each element of cost and is it cross-referenced to
                                             the supporting cost or pricing data?
12. FAR 15.408, Table 15-2, Section I       Does the proposal identify any incurred costs for work
 Paragraph F.                                performed before the submission of the proposal?
13. FAR 15.408, Table 15-2, Section I       Is there a Government forward pricing rate agreement (FPRA)?
 Paragraph G.                                If so, the offeror shall identify the official submittal of
                                             such rate and factor data. If not, does the proposal include
                                             all rates and factors by year that are utilized in the
                                             development of the proposal and the basis for those rates and
                                             factors?
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                      COST ELEMENTS
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 MATERIALS AND SERVICES
--------------------------------------------------------------------------------------------------------------------------------------------------------
14. FAR 15.408, Table 15-2, Section II      Does the proposal include a consolidated summary of individual
 Paragraph A.                                material and services, frequently referred to as a
                                             Consolidated Bill of Material (CBOM), to include the basis
                                             for pricing? The offeror's consolidated summary shall include
                                             raw materials, parts, components, assemblies, subcontracts
                                             and services to be produced or performed by others,
                                             identifying as a minimum the item, source, quantity, and
                                             price.
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 18874]]

 
                                                     SUBCONTRACTS (Purchased materials or services)
--------------------------------------------------------------------------------------------------------------------------------------------------------
15. DFARS 215.404-3.......................  Has the offeror identified in the proposal those subcontractor
                                             proposals, for which the contracting officer has initiated or
                                             may need to request field pricing analysis?
16. FAR 15.404-3(c).......................  Per the thresholds of FAR 15.404-3(c), Subcontract Pricing
FAR 52.244-2..............................   Considerations, does the proposal include a copy of the
                                             applicable subcontractor's certified cost or pricing data?
17. FAR 15.408, Table 15-2, Note 1;         Is there a price/cost analysis establishing the reasonableness
 Section II Paragraph A.                     of each of the proposed subcontracts included with the
                                             proposal? If the offeror's price/cost analyses are not
                                             provided with the proposal, does the proposal include a
                                             matrix identifying dates for receipt of subcontractor
                                             proposal, completion of fact finding for purposes of price/
                                             cost analysis, and submission of the price/cost analysis?
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      EXCEPTIONS TO CERTIFIED COST OR PRICING DATA
--------------------------------------------------------------------------------------------------------------------------------------------------------
18. FAR 52.215-20.........................  Has the offeror submitted an exception to the submission of
FAR 2.101, ``commercial item''............   certified cost or pricing data for commercial items proposed
                                             either at the prime or subcontractor level, in accordance
                                             with provision 52.215-20?
                                            a. Has the offeror specifically identified the type of
                                             commercial item claim (FAR 2.101 commercial item definition,
                                             paragraphs (1) through (8)), and the basis on which the item
                                             meets the definition?
                                            b. For modified commercial items (FAR 2.101 commercial item
                                             definition paragraph (3)); did the offeror classify the
                                             modification(s) as either--
                                              i. A modification of a type customarily available in the
                                            commercial marketplace (paragraph (3)(i)); or
                                              ii. A minor modification (paragraph (3)(ii)) of a type not
                                            customarily available in the commercial marketplace made to
                                            meet Federal Government requirements not exceeding the
                                            thresholds in FAR 15.403-1(c)(3)(iii)(B)?
                                            c. For proposed commercial items ``of a type'', or ``evolved''
                                             or modified (FAR 2.101 commercial item definition paragraphs
                                             (1) through (3)), did the contractor provide a technical
                                             description of the differences between the proposed item and
                                             the comparison item(s)?
19. FAR 15.408, Table 15-2, Section II      Does the proposal include a price analysis for all commercial
 Paragraph A.                                items offered that are not available to the general public?
20. FAR 15.408, Table 15-2, Section II      Does the proposal support the degree of competition and the
 Paragraph A(1).                             basis for establishing the source and reasonableness of price
                                             for each subcontract or purchase order priced on a
                                             competitive basis exceeding the threshold for certified cost
                                             or pricing data?
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                              INTERORGANIZATIONAL TRANSFERS
--------------------------------------------------------------------------------------------------------------------------------------------------------
21. FAR 15.408, Table 15-2, Section II      For inter-organizational transfers proposed at cost, does the
 Paragraph A.(2).                            proposal include a complete cost proposal in compliance with
                                             Table 15-2?
22. FAR 15.408, Table 15-2, Section II      For inter-organizational transfers proposed at price in
 Paragraph A(1).                             accordance with FAR 31.205-26(e), does the proposal provide
                                             an analysis by the prime that supports the exception from
                                             certified cost or pricing data in accordance with FAR 15.403-
                                             1?
--------------------------------------------------------------------------------------------------------------------------------------------------------

[[Page 18875]]

 
                                                                      DIRECT LABOR
--------------------------------------------------------------------------------------------------------------------------------------------------------
23. FAR 15.408, Table 15-2, Section II      Does the proposal include a time phased (i.e.; monthly,
 Paragraph B.                                quarterly) breakdown of labor hours, rates and costs by
                                             category or skill level? If labor is the allocation base for
                                             indirect costs, the labor cost must be summarized in order
                                             that the applicable overhead rate can be applied.
24. FAR 15.408, Table 15-2, Section II      For labor Basis of Estimates (BOEs), does the proposal include
 Paragraph B.                                labor categories, labor hours, and task descriptions--(e.g.;
                                             Statement of Work reference, applicable CLIN, Work Breakdown
                                             Structure, rationale for estimate, applicable history, and
                                             time-phasing)?
25. FAR subpart 22.10.....................  If covered by the Service Contract Labor Standards statute (41
                                             U.S.C. chapter 67), are the rates in the proposal in
                                             compliance with the minimum rates specified in the statute?
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                     INDIRECT COSTS
--------------------------------------------------------------------------------------------------------------------------------------------------------
26. FAR 15.408, Table 15-2, Section II      Does the proposal indicate the basis of estimate for proposed
 Paragraph C.                                indirect costs and how they are applied? (Support for the
                                             indirect rates could consist of cost breakdowns, trends, and
                                             budgetary data.)
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                       OTHER COSTS
--------------------------------------------------------------------------------------------------------------------------------------------------------
27. FAR 15.408, Table 15-2, Section II      Does the proposal include other direct costs and the basis for
 Paragraph D.                                pricing? If travel is included does the proposal include
                                             number of trips, number of people, number of days per trip,
                                             locations, and rates (e.g. airfare, per diem, hotel, car
                                             rental, etc)?
28. FAR 15.408, Table 15-2, Section II      If royalties exceed $1,500 does the proposal provide the
 Paragraph E.                                information/data identified by Table 15-2?
29. FAR 15.408, Table 15-2, Section II      When facilities capital cost of money is proposed, does the
 Paragraph F.                                proposal include submission of Form CASB-CMF or reference to
                                             an FPRA/FPRP and show the calculation of the proposed amount?
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      FORMATS FOR SUBMISSION OF LINE ITEM SUMMARIES
--------------------------------------------------------------------------------------------------------------------------------------------------------
30. FAR 15.408, Table 15-2, Section III...  Are all cost element breakdowns provided using the applicable
                                             format prescribed in FAR 15.408, Table 15-2 III? (or
                                             alternative format if specified in the request for proposal)
31. FAR 15.408, Table 15-2, Section III     If the proposal is for a modification or change order, have
 Paragraph B.                                cost of work deleted (credits) and cost of work added
                                             (debits) been provided in the format described in FAR 15.408,
                                             Table 15-2.III.B?
32. FAR 15.408, Table 15-2, Section III     For price revisions/redeterminations, does the proposal follow
 Paragraph C.                                the format in FAR 15.408, Table 15-2.III.C?
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                          OTHER
--------------------------------------------------------------------------------------------------------------------------------------------------------
33. FAR 16.4..............................  If an incentive contract type, does the proposal include
                                             offeror proposed target cost, target profit or fee, share
                                             ratio, and, when applicable, minimum/maximum fee, ceiling
                                             price?
34. FAR 16.203-4 and FAR 15.408 Table 15-   If Economic Price Adjustments are being proposed, does the
 2, Section II, Paragraphs A, B, C, and D.   proposal show the rationale and application for the economic
                                             price adjustment?
35. FAR 52.232-28.........................  If the offeror is proposing Performance-Based Payments--did
                                             the offeror comply with FAR 52.232-28?

[[Page 18876]]

 
36. FAR 15.408(n).........................  Excessive Pass-through Charges--Identification of Subcontract
FAR 52.215-22.............................   Effort: If the offeror intends to subcontract more than 70%
FAR 52.215-23.............................   of the total cost of work to be performed, does the proposal
                                             identify:
                                            (i) the amount of the offeror's indirect costs and profit
                                             applicable to the work to be performed by the proposed
                                             subcontractor(s); and (ii) a description of the added value
                                             provided by the offeror as related to the work to be
                                             performed by the proposed subcontractor(s)?
--------------------------------------------------------------------------------------------------------------------------------------------------------


(End of provision)

[FR Doc. 2013-07106 Filed 3-27-13; 8:45 am]
BILLING CODE 5001-06-P